Some G20 countries want to tax the fortunes of billionaires at at least 2%, everywhere around the globe. In Switzerland, the idea appeals to the left. On the right, however, it is considered unsuitable and unadaptable.
Francesco Benini / ch media
The final declaration of the G20 summit in Rio de Janeiro contains a sentence that is enough to make tax-phobic people shudder:
“While fully respecting fiscal sovereignty, we are working together to ensure that very wealthy individuals are effectively taxed”
The summit’s host, Brazilian President Lula, would have liked more concrete wording this week. He campaigns for billionaires to pay at least 2% taxes on their wealth. This would generate around $250 billion in revenue per year.
Lula considers himself the spokesperson for the Global South and now intends to take the project to the UN. What does this mean for Switzerland? What are the reactions to this requirement targeted at the very rich?
For PS co-president Cédric Wermuth, “the explosion of inequalities certainly remains the fundamental problem of our time”. His party colleague, national councilor Fabian Molina, speaks of a “long-awaited measure to tackle the big problems of this world: hunger and the climate crisis”. Switzerland should follow suit, the global South wants reforms to the taxation of big fortunes and he will not allow himself to be diverted from this path. The Zurich socialist still believes that the demand for tax justice is becoming an international priority.
The Greens seduced, the right hates
The Greens say they are just as favorable:
“Our country must absolutely participate”
Lisa Mazzone, president of the Greens
According to her, wealth is distributed extremely unequally in Switzerland and around the world. A situation that hinders the fight against poverty and the environmental crisis:
“This is why we, the Greens, have been campaigning for higher taxes for a long time, particularly on the wealthy.”
In the bourgeois camp, on the other hand, the idea is having difficulty getting through. For the president of the PLR, Thierry Burkart:
“Instead of jealously debating how to divide the pie, we should ensure, through liberal policy, that we have a bigger pie for everyone.”
For the liberal-radical, it is out of the question to tax the Swiss population more. Furthermore, the experience of the OECD minimum tax shows that the United States ignored its own rules to poach the best Swiss taxpayers:
“Ultimately, the economic center is losing its attractiveness, and it is the middle class that is paying the price.”
The head of the UDC parliamentary group Thomas Aeschi emphasizes that “the wealthiest people pay taxes in Switzerland on income, on wealth and many others, such as those on dividends. The federal tax is, according to him, very progressive:
“The SVP does not believe in international tax harmonization. How did this happen with the OECD minimum tax for businesses? Under pressure from Brussels, we implemented it, while almost no other country applies it. We must learn from our mistakes.”
The president of the Center, Gerhard Pfister, shares this opinion: there is no question of joining the project. “Moderate taxation of the very rich works well. They are also expected to contribute beyond that to the cohesion of the country, for example through support for numerous institutions.” This prevents a certain social class from becoming detached from the rest of society. On this point, it is not quite the same in Brazil.
Many states without wealth taxes
Switzerland currently has 86 billionaires, more than any other country relative to its population. What does the Federal Department of Finance think of this claim? “We are closely following the discussions on the taxation of very wealthy private individuals within the G20,” says communications chief Pascal Hollenstein. According to him, it is important for Switzerland that each country can take into account the particularities of its tax system when taxing taxpayers:
“Uniform international regulation would miss its target”
Pascal Hollenstein nevertheless underlines that our country has a wealth tax which brings in big benefits for public finances. It represents at least 10% of tax revenue at the cantonal and municipal level in around half of the cantons. Personal income tax is generally progressive.
Ernst Stocker, the president of the cantonal finance directors, notes:
“Unlike many states, Switzerland already has a wealth tax. It is levied at the cantonal level and brings in approximately nine billion francs in tax revenue each year to the cantons and their municipalities.”
For UDC national advisor Thomas Aeschi, he sees a brake on this taxation of billionaires: “I doubt that the Trump government will adhere to the project”.
The news in Switzerland is here
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Translated and adapted by Valentine Zenker
