The cost of living in Switzerland is among the highest in the world, with the main cities Zurich and Geneva being named in the top 15 most expensive cities in the world in a 2019 study. On the other hand, Swiss salaries and the living standards are also among the highest in the world, which is the main reason why you should consider Switzerland a perfect location for work and living a quality life.
The calculation of the tax rates in Switzerland is based on the net income of the taxpayer. Like in most other European countries, there are several tax deductions that can be made when a tax declaration is filed in Switzerland. These will reduce the taxable income and consequently the value of tax that needs to be paid diminishes significantly.
The Swiss government has gone the extra mile in leveraging low corporate tax rates as a competitive advantage. In Switzerland, corporate tax rates vary depending on the canton where you are operating your business.
On May 19, 2019, Swiss voters created the basis for the cantonal implementation of the tax reform, once the federal law on this reform was adopted. Thus, the effective integration of the tax reform takes place through its implementation in the cantonal tax laws.
The low level of taxes represents a traditional advantage of Switzerland compared to other developed countries in efforts to attract large companies. Moreover, between the Swiss cantons is a continuous "fiscal struggle" for the lure of big investors.
Over the past few years, more and more companies have started to strategise ways by which they can escape giving their hard-earned profits to governments. This is the reason why many major global firms decide to set up their headquaters in low taxing jurisdictions like Switzerland. Switzerland is one of the most welcoming investment destinations for foreign investors due to its low taxation, a favourable economic legislature, among many other advantages.
