Shock reform for border workers: they will pay more taxes (cross-border guide)

Context

In a nutshell

• The Ticino League has presented a shock proposal for border workers in Ticino. - The proposal is to transform the old frontier workers into new ones, in order to pay more taxes. - The proposal was presented as a measure to help the public finances of the Canton of Ticino.

The proposal in detail

The Ticinese League has presented a reform proposal that envisages transforming old frontier workers into new ones, in order to pay more taxes. This measure was presented as a solution to help the public finances of the Canton of Ticino, which are in a situation of severe deficit.

How the reform will work

The proposal foresees that the old frontier workers, who have already worked in the Canton of Ticino for a certain period of time, will be considered as new frontier workers. This means that they will have to pay the taxes of a new frontier worker, which can reach up to 20% of their salary. This measure will be applied to all border workers who have worked in the Canton of Ticino for at least 5 years.

Concrete examples

For example, if a frontier worker has worked in the Canton of Ticino for 10 years and has a salary of CHF 60,000 per year, he will have to pay the taxes of a new frontier worker, which amount to CHF 12,000 per year. This means that the frontier worker will have to pay a total of 72,000 francs per year, of which 12,000 francs are taxes.

Comparison with the current scenario

Currently, border crossers pay a 10% fee

Operational details

Key facts

• The proposal was presented by the Ticinese League. - The proposal envisages transforming old frontier workers into new ones. - The proposal was presented as a measure to help the public finances of the Canton of Ticino. - The proposal is based on a law approved by the State Council of the Canton of Ticino on 15 February 2022. - The law provides that frontier workers who worked in the Canton of Ticino before 1 January 2020 can be considered as new frontier workers if they meet certain conditions.

The proposal of the Ticinese League envisages applying the law approved by the State Council of the Canton of Ticino on 15 February 2022 also to border workers who worked in the Canton of Ticino before 1 January 2020. This means that frontier workers who have worked in municipalities such as Bellinzona, Lugano and Locarno could be considered as new frontier workers if they meet certain conditions.

The proposal provides that border workers who are considered as new could be obliged to pay taxes on non-residential work income, as provided for by the law approved by the State Council of the Canton of Ticino on 15 February 2022. The taxation of non-residential work income is established by the federal law of 22 March 2019, which provides that non-residential work income is taxed at a rate of 7.5%.

According to the proposal of the Ticinese League, frontier workers who are considered as

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Key points

The proposal in detail

The Ticino League has presented a shock proposal for border workers in Ticino. The proposal envisages turning old frontier workers into new ones, in order to pay more taxes. The proposal was presented as a measure to help the public finances of the Canton of Ticino.

The proposal envisages increasing taxes for border workers residing in municipalities such as Lugano, Bellinzona and Locarno. According to the Ticinese League, the new taxation system could generate additional revenue of around CHF 10 million per year.

The proposal envisages applying the following tax rates:

• 2% for frontier workers earning up to CHF 30,000 per year
• 3% for frontier workers earning between CHF 30,001 and CHF 60,000 per year
• 4% for frontier workers earning more than CHF 60,000 per year

The proposal was criticized by some members of the Christian Democratic Party, who said that the new tax system could be discriminatory against border workers.

"The proposal of the Ticinese League is a low blow for border workers," said the leader of the Christian Democratic Party, Giovanni Rüedi.

The proposal was presented on the occasion of the State Council of the Canton of Ticino, which was held on 20 July 2023. The proposal must be voted on by 15 September 2023.

The Ticino League has stated that the proposal is necessary to help the public finances of the Canton of Ticino,

Check tax deadlines for cross-border workers: returns, Swiss declarations, rebates — all dates in one interactive calendar.

Source: comozero.it