The Swiss Times - Swiss News in English

Council of States against amendment of law for voluntary withholding tax

Voluntary withholding tax is off the table: unlike the National Council, the Council of States does not want to change the law to allow Swiss and resident taxpayers to voluntarily deduct part of their income tax directly from their salary.

The decision of the Council of States on a parliamentary initiative by National Councillor Emmanuel Amoos (SP/VS) was made by 24 votes to 13, with one abstention. The initiative is therefore off the table.

Andrea Caroni (FDP/AR) said that the initiative was unnecessary, as the option of a voluntary advance tax payment already exists. Moreover, those who would need it are unlikely to use the instrument. And there would be additional administrative work for employers and the state.

The majority argued that a direct deduction from wages would also leave those affected without the money for their other needs. For them, financial advice would be more helpful than voluntary withholding tax.

Around ten percent of people in Switzerland are in arrears with their taxes, replied Carlo Sommaruga (SP/GE) on behalf of the minority. The bill could help to avoid losses for the public sector. Moreover, certain employees are already taxed at source.

Céline Vara (Greens/NE) added that many people with debts were ill and absent from work. This causes costs for employers. The additional expense for taxation at source is economically worthwhile for them because their employees are absent less.

Amoos justified his proposal by stating that this would have a considerable impact on municipalities, cantons and the federal government. Every year, public administrations have to write off hundreds of millions of francs in tax debts as bad debt losses.


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