Federal Council no longer wants lower VAT for hotels
Published: Thursday, Aug 29th 2024, 11:40
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The Federal Council no longer wants a lower special VAT rate for the hotel industry. It rejects demands from parliament for a further extension beyond 2027.
The special rate of 3.8 percent for accommodation services has been in place since 1996, when it was introduced as a temporary measure to support the ailing hotel industry. Since then, the special rate has been extended six times, the last time until 2027.
The Federal Council justifies its no vote with the positive development of tourism. The number of overnight stays rose to a new high of almost 42 million last year, it wrote in its statement published on Thursday. The outlook for tourism is also positive.
If accommodation providers had to pay VAT at the standard rate - currently 8.1 percent - this would generate an additional CHF 270 million a year for the federal government, writes the Federal Council. If the special rate is extended, this amount would have to be compensated from 2028.
The demand to extend the special rate was put forward by Philipp Matthias Bregy (Center/VS) in the National Council and Esther Friedli (SVP/SG) in the Council of States, each with a motion. In both councils, members of the SVP, FDP and Center supported the motions. The two chambers will decide on this next.
The motions are justified on the grounds of planning security for hotel businesses. A definitive determination of the special rate for accommodation services creates planning security. In view of the proportion of foreign guests, tourism is an export industry, but provides its services domestically.
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