Wed, Mar 27th 2024
The recent VAT hike in Switzerland hasn’t fully trickled down to consumer prices, revealing a cautious approach in adjusting retail figures.
The VAT increase at the beginning of this year has not been reflected in the majority of prices.
The prices of 87.5% of the products surveyed by the price watchdog have not yet been increased at all, and the VAT adjustment has not been passed on in full or at all for around 90%.
This is the conclusion of the price monitor’s analysis published on Tuesday, according to a statement from the Federal Department of Economic Affairs, Education and Research (EAER).
The analysis in the Price Monitor’s newsletter is based on a three-stage monitoring process. Earlier increases in VAT, such as those in the 1990s, had a more significant impact on prices.
Several factors contributed to the more cautious passing on of the VAT rate adjustments to consumers, in particular the abolition of industrial tariffs. Another success factor was the early announcement that price developments would be closely monitored.
An increase in value added tax came into force in Switzerland on January 1: The standard rate was increased from 7.7% to 8.1%, the reduced rate is now 2.6% instead of 2.5%, and the special rate for accommodation rose from 3.7% to 3.8%.
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