Research-intensive companies pay less tax
Published: Thursday, Jul 25th 2024, 17:30
Updated At: Friday, Jul 26th 2024, 01:59
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Thanks to the innovation-friendly structure of the Swiss tax system, the tax burden for research-intensive companies is lower than the Swiss average. This is the result of a study by the Basel-based economic research institute BAK Economics.
With an average research intensity, the effective tax burden on the Swiss average is reduced from 13.5 to 12.1 percent, with a very high research intensity to 9.0 percent, according to a BAK press release on Thursday.
The Basel Institute for Economic Research investigated the impact of the STAF R&D instruments on the average tax burden for companies in 2024. STAF R&D instruments refer to tax reform and AHV financing/STAF and tax breaks for research and development expenditure/R&D.
The BAK Taxation Index 2024 was compiled by the Basel Institute in close cooperation with the ZEW - Leibniz Center for European Economic Research in Mannheim, Baden-Württemberg.
Scope for the cantons
According to the BAK, the extent of the tax relief provided by the R&D instruments depends on the cantonal structure and the level of the ordinary tax burden. As a result, the resulting tax relief can vary greatly between cantons.
Cantons with a high ordinary tax burden in particular can significantly reduce their effective tax burden with generous R&D instruments, as the BAK writes. As a result, cantons such as Bern and Zurich with a high research intensity could move up significantly in the rankings.
According to the BAK, R&D instruments or tax concessions for research are widespread in developed economies. Compared to most international comparison locations, the Swiss cantons have a lower tax burden with an average research intensity. Only in Ireland, Singapore and France are research-intensive companies taxed even less.
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