Swiss voters support global corporate minimum tax and environmental goals

According to public broadcaster SRF, voters in Switzerland on Sunday approved the implementation of a global minimum tax on corporations as well as a climate law that seeks to reduce the use of fossil fuels and achieve zero emissions by 2050.

According to the results of the nationwide referendum held on Sunday, an exceptionally high percentage of voters supported increasing the nation’s corporate tax from the existing average minimum of 11% to the 15% worldwide minimum rate.

Finance Minister Karin Keller-Sutter stated that doing this “ensures that Switzerland will not lose any tax revenue to foreign countries.” Additionally, it will establish legal clarity and a solid structure.

Similarly, the climate bill was adopted and supported by 59% of voters.

In an effort to curtail the practise of transferring earnings to low-tax jurisdictions, Switzerland joined the almost 140 other nations that agreed to an OECD agreement in 2021 that set a minimum tax rate for large corporations.

The plan, which is expected to generate an additional 2.5 billion Swiss francs ($2.80 billion) in income year and maintain Switzerland’s position as having one of the lowest corporation tax rates in the world, has the support of business organisations, the majority of political parties, and the general public.

The climate law, which was reintroduced in a modified version after it was rejected in 2021 as being too expensive, has sparked additional discussion, with those opposed to it gaining ground recently.

While opponents from the right-wing People’s Party claim it would risk energy security, proponents contend that the measure is the very minimum the affluent nation needs to do to demonstrate its commitment to battling climate change.

In the referendum held on Sunday, voters also agreed to prolong a few COVID-19 emergency law measures. This was necessary under Switzerland’s direct democracy system, in which legislation is decided by popular vote.

Around 2,000 international firms, including Google (GOOGL.O) and 200 Swiss multinationals, like Nestle (NESN.S), have offices and headquarters in Switzerland. Even though everyone would be impacted, business organisations have praised the increased certainty the new tax would offer, even if Switzerland would no longer be as attractive due to its low tax rate.

“No other nation will have less expensive taxes either. Christian Frey from the lobbying organisation Economiesuisse stated, “We want the extra tax income to stay in the nation and be utilised to boost its attractiveness for enterprises.

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