What happens if the Conciliation Conference does not reach an agreement on the 13th AVS?

If the Conciliation Conference fails to reach an agreement on the 13th AVS, the 13th AVS benefit will be paid from December without any funding. This would create a deficit in the AVS accounts that will need to be covered by later measures.

How much does VAT increase with the National Council's proposal?

The standard VAT rate rises by 0.4 percentage points, and the hotel sector rate by 0.2 points. The reduced rate for essential goods remains unchanged. The increase is limited to 2033 as a temporary solution.

Does the 13th AVS also apply to cross‑border workers?

Yes, the 13th AVS applies to all AVS benefit recipients, including cross‑border workers who have paid sufficient contributions. It equals an additional month of benefit calculated on the same basis.

Why does the National Council prefer VAT to payroll contributions?

The National Council chose VAT to avoid increasing payroll deductions, keeping workers' net salaries unchanged. The vote passed narrowly: 101 votes to 95, with 2 abstentions.

What changes for the Sunday openings of shops?

The cantons did not address the proposal that would allow 12 unlicensed Sunday openings instead of the current four. The vote was 22 to 21. At present the situation remains unchanged.

13th AVS: conciliation, VAT up 0.4%

By Laura Bianchi (editorial byline of the newsroom, AI-generated text) · Published on 12 June 2026 · Updated on 31 October 2026

Swiss Parliament and 13th AVS pension funding

National and States disagree: 13th AVS goes to conciliation. Risk of payment without funding. VAT increase at the center of the debate.

Context

In brief

National Council rejects mixed VAT+contributions financing for the 13th AVS pension
Dossier goes to conciliation conference
If no agreement: 13th pension paid from December without funding
Proposed VAT increase: +0.4% standard, +0.2% hotel

Key facts

What: Parliamentary block on financing the 13th AVS pension
When: 9 June 2026
Where: Federal Parliament, Bern
Who: National Council and Council of States
VAT amount: +0.4 points standard rate, +0.2 points hotel sector, 0 for essential goods
National Council vote: 101 against 95, with 2 abstentions
VAT deadline: increase limited to 2033
Next step: Conciliation conference

On 9 June 2026, the National Council reiterated its position on the financing of the 13th AVS pension, rejecting once again the proposal of the Council of States which provided for mixed financing through VAT and wage contributions. The decision passed narrowly: 101 votes against 95 and 2 abstentions. The National Council prefers to entrust the entire financial coverage to the increase in value added tax, avoiding any increase in wage deductions.

The tug-of-war between the two chambers

The divergence between the two Chambers is now structural. The Council of States argues that mixed financing guarantees greater stability over time, distributing the burden between consumers and workers. The National Council, on the other hand, insists on VAT alone so as not to affect wages, a position it also reiterated in previous sessions. The result is a deadlock that now delegates the solution to the conciliation conference.

If no agreement is reached there either, the 13th AVS pension will be paid starting from December without being funded. A concrete hypothesis that would create a hole in the coffers of the first pillar, with direct repercussions on all AVS contributors, including cross-border workers who pay contributions from Canton Ticino and throughout Swiss territory.

The National Council also reiterated the need to repair AVS finances within the framework of the next major reform called AVS 2030. The financing adopted today must therefore be understood as a transitional solution. The VAT increase — with 0.4 additional points for the standard rate and 0.2 for the hotel sector rate, with no changes for essential goods — is in fact limited to 2033.

The other decisions of the day

In parallel, the Council of States surprised everyone by not entering into the matter on a project that would have authorized shops to stay open for 12 Sundays a year without authorization, instead of the current 4. The Chamber of the Cantons deliberated with a single vote margin: 22 to 21. The preparatory committee recommended entering into the matter, convinced that the revision responded to the need for greater flexibility and increased the competitiveness of Swiss shops compared to online commerce and foreign border area retailers — an issue that directly concerns Canton Ticino and its business owners.

The Council of States also approved, with 31 votes against 7, a modified motion to better protect temporary workers hired for at least six months in the event of work interruption due to heatwaves. The text now returns to the National Council.

Operational details

What it means for cross-border workers: the concrete impact of the VAT increase

For those living in Italy and working in Switzerland, funding the 13th AVS pension solely through VAT has a specific meaning. Swiss VAT is paid on every purchase of goods and services in Swiss territory: from daily shopping to restaurants, from clothing to medical care not covered by the LAMal. An increase of 0.4 points in the standard rate — from the current 8.1% to 8.5% — translates into an additional cost on every transaction.

The hospitality sector, already subject to a reduced rate, would see an increase of 0.2 points. For essential goods, however, the rate remains unchanged at 2.5%, an exemption that partially mitigates the impact on the most vulnerable groups.

VAT vs. salary contributions: comparing two scenarios

The choice between funding through VAT or salary contributions is not neutral for cross-border workers. The VAT increase affects consumption: those who spend more in Switzerland pay proportionally more. An increase in salary contributions, on the other hand, would directly impact the paycheck, reducing the monthly net income. The National Council chose the former to avoid increasing salary deductions, a decision that for cross-border workers means maintaining their net salary intact but paying slightly more on every cross-border purchase.

It should be noted that the solution is temporary: the VAT increase expires in 2033, the year by which the AVS2030 reform must provide structural coverage. If the Conciliation Conference fails to reach an agreement, the 13th pension will be paid without funding, creating a deficit that will have to be covered later — with possible new measures on VAT, contributions, or pensions.

The link with AVS and LPP for cross-border workers

The 13th AVS pension concerns all contributors to the first pillar, including cross-border workers with a G permit who pay AVS contributions on their Swiss salary. The AVS pension is calculated based on years of contributions and average pensions, and the 13th pension is equivalent to an additional month of pension. For those planning retirement by combining AVS and LPP, this parliamentary resolution has a direct impact: a higher pension also means a better balance between contributions paid and benefits received, a crucial aspect when comparing the Swiss and Italian pension systems.

Useful planning tools

To estimate your pension strategy, use the pension planner and the pillar 3 simulator.

Key points

Prepare for the 13th AVS and IVA Increase: Your Checklist for Cross-Border Workers

With the 13th AVS in the spotlight and the IVA increase at the center of the transitional solution, it is advisable to take concrete measures now.

1. Verify your AVS statement: Check the years of contribution recognized at the AVS Compensation Office. Each missing year reduces future income, and the 13th is calculated on the same basis.

2. Calculate the impact of IVA on your expenses: Estimating your annual spending in Switzerland allows you to quantify the increase of 0.4 points. For an annual expenditure of 20,000 CHF, the increase is approximately 80 CHF per year.

3. Monitor the Conciliation Conference: If no agreement is reached, the 13th AVS will be paid without funding. This could trigger future corrective measures on contributions or income itself.

4. Integrate AVS and LPP in your pension plan: The 13th AVS is just a piece of the puzzle. Verify your professional pension account and evaluate if integrating with a 3rd Pillar is beneficial for optimizing tax and income.

5. Check your tax declaration: The IVA increase does not affect the tax on the income of cross-border workers, but it should be considered in the overall family budget, especially in the comparison of the cost of living between Switzerland and Italy.

Practical Tools for Assessing the Impact

To accurately calculate how the 13th AVS and the IVA increase affect your net salary and future income, use the net salary calculator. The cross-border worker tool allows you to simulate different contribution scenarios and verify the effect of the updated IVA on your finances.

For a detailed comparison of the cost of living in Canton Ticino and the Italian provinces bordering Switzerland — where the Swiss IVA increase affects differently depending on cross-border spending — consult the cost of living comparator. And to understand how the 13th AVS fits into your overall pension plan, the pension simulator integrates AVS, LPP, and 3rd Pillar in a single projection.

Source: rsi.ch

Frequently Asked Questions

What happens if the Conciliation Conference does not reach an agreement on the 13th AVS?: If the Conciliation Conference fails to reach an agreement on the 13th AVS, the 13th AVS benefit will be paid from December without any funding. This would create a deficit in the AVS accounts that will need to be covered by later measures.
How much does VAT increase with the National Council's proposal?: The standard VAT rate rises by 0.4 percentage points, and the hotel sector rate by 0.2 points. The reduced rate for essential goods remains unchanged. The increase is limited to 2033 as a temporary solution.
Does the 13th AVS also apply to cross‑border workers?: Yes, the 13th AVS applies to all AVS benefit recipients, including cross‑border workers who have paid sufficient contributions. It equals an additional month of benefit calculated on the same basis.
Why does the National Council prefer VAT to payroll contributions?: The National Council chose VAT to avoid increasing payroll deductions, keeping workers' net salaries unchanged. The vote passed narrowly: 101 votes to 95, with 2 abstentions.
What changes for the Sunday openings of shops?: The cantons did not address the proposal that would allow 12 unlicensed Sunday openings instead of the current four. The vote was 22 to 21. At present the situation remains unchanged.