Swiss Tax Amnesty: the results of the referendum dated 18 May 2014
On 18 May 2014, Swiss voters clearly approved the popular initiative for the introduction of the cantonal tax amnesty. The cantonal tax amnesty, which encountered the favour of the 52% of the voters, was supported by the cantonal government and by most of parties of the centre wing and of the right wing.
The tax amnesty aims at favouring the disclosure of non-reported foreign capital hidden outside the cantonal borders, through a measure similar to national amnesty programs already experienced in several European countries during the past years, similar to the Italian “tax shield”.
After a four-year period, which began with the publication of the Message of the State Council on 23 February 2010, but with the opposition of the parliament, the Swiss people decided on the future of the cantonal tax amnesty. However, an appeal before the Federal Court is still pending to assess the compatibility of the cantonal tax amnesty with the federal law. For this reason, although the Swiss people voted for the tax amnesty, it is however necessary to wait for the judgment of the Court in Lausanne.
The tax amnesty of Canton Ticino provides for the recovery of the cantonal and municipal taxes in the previous ten years. Nevertheless, evaded tax bases object of the tax amnesty will be hit by the normal applicable tax rates, reduced for 70%. The tax amnesty applies to income and wealth taxes of individuals, and to income and capital taxes of companies, to inheritance and gift taxes, as well as to the real estate capital gain tax. However, all other direct federal tax, indirect taxes, and required contributions for social insurance are outside the scope of the tax amnesty.
If the tax amnesty were finally approved, then the new federal provisions on the simplification of additional taxation for inheritances and those on the introduction of a general self-reporting without punishment would be more attractive. According to these provisions, in the case the taxpayer spontaneously reports to the tax authorities his or her case of violation of the tax law for the first time, and the offence is unknown to the administration, no penalty for tax evasion of tax fraud will apply. Taxpayers can benefit from such a measure only once in their life.