Swiss army horses: rising costs

Context

In brief

• Swiss parliament debates CHF 3.8 million for army horses — a window into Swiss fiscal rigour
• The strength of the CHF is inseparable from this culture of public spending scrutiny
• Practical strategies for cross-border workers receiving salaries in CHF and spending in EUR

When the Swiss federal parliament sits down to question whether 51 army horses are worth CHF 3.8 million over 2026-2028 — complete with a Federal Audit Court report noting the animals are used for only around 70 days a year — it may look like political theatre. In Switzerland, it is routine practice. Every budget line, no matter how small, faces structured scrutiny. That same culture is one of the structural reasons the Swiss franc remains one of the world's most stable currencies.

For a cross-border worker whose monthly salary arrives in CHF, this is not an abstract political curiosity. It directly shapes the purchasing power of every franc you earn.

Why the CHF is a safe-haven currency — and why it matters for frontalieri

The Swiss franc's stability rests on three structural foundations: a constitutional "debt brake" (Schuldenbremse) introduced in 2003 that forces the federal budget to remain structurally balanced over the economic cycle; historically low inflation; and a Swiss National Bank (SNB) that intervenes with exceptional caution.

The result is a currency that appreciates in times of global uncertainty, attracting international capital. During the 2011 eurozone debt crisis, the 2020 pandemic and the 2022-2023 inflation surge, the CHF strengthened significantly against the EUR on each occasion. For cross-border workers, CHF appreciation means a higher real income in euro terms without any change in gross salary.

The parliamentary debate over army horses is a small example of the discipline that makes this possible: in Switzerland, no expenditure is exempt from scrutiny and potential reduction.

Practical steps for cross-border workers

1. Monitor the CHF/EUR exchange rate weekly using apps such as Wise, XE or Google Finance. A 1% move on a CHF 5,000 monthly salary equals about EUR 50 — meaningful over a year. 2. Open a multi-currency account (Revolut, Wise, N26) to accumulate CHF and convert to EUR selectively rather than automatically each month. 3. Avoid automatic bank conversions: traditional banks apply average spreads of 1.5–3% above the interbank rate, costing EUR 500–1,500 per year on a typical frontaliere salary.

Operational details

CHF strength: opportunities and risks for workers who earn in CHF and live in EUR

Working in Switzerland while living in Italy means income in CHF and most daily expenses in EUR. When the franc appreciates — as it has done broadly over the past decade — your real purchasing power in Italy increases passively. When it weakens, the effect reverses.

Over the past ten years, the CHF has appreciated against the EUR by roughly 10–15% in cumulative terms, with sharp upward spikes in 2015 (when the SNB abandoned the EUR/CHF 1.20 floor, causing an overnight jump) and again in 2022-2023. For a worker converting CHF 50,000 per year, a 5% exchange rate movement is worth approximately EUR 2,500 more or less annually — without any change to the job.

Practical scenarios

Scenario A — Monthly automatic transfer via traditional bank: A cross-border worker converts CHF 4,000 every month-end via a standard bank transfer from their Swiss to their Italian account. The bank applies a spread of 1.8% above interbank. Annual cost on exchange alone: approximately EUR 650–700.

Scenario B — Multi-currency approach with selective conversion: The same worker accumulates CHF on a Wise or Revolut account, monitors the rate and converts when the CHF is near its 30-day high against the EUR. Exchange costs drop to around 0.4–0.5%. In a year with favourable rate movement, the advantage over Scenario A can reach EUR 800–1,200.

The combined difference between these two approaches — fee saving plus timing benefit — can reach EUR 1,000–1,500 per year for a mid-range salary earner.

On the broader fiscal picture: The SNB holds foreign exchange reserves exceeding 100% of Swiss GDP, one of the highest ratios in the world. This buffer is possible precisely because the Confederation avoids structural deficits. The parliamentary scrutiny of every public expenditure — from F-35 jets to army horses — is part of the system that maintains this fiscal space and, indirectly, keeps the CHF strong.

Key points

Practical guide: optimising CHF-to-EUR conversion in 2026

Several accessible tools now allow cross-border workers to reduce conversion costs and manage currency exposure without specialist financial knowledge.

Recommended platforms (roughly in order of average cost efficiency):

• Wise (formerly TransferWise): Uses the real interbank rate with a transparent fixed fee of around 0.4–0.7%. Ideal for regular monthly transfers. Account opens in minutes with an Italian ID document.
• Revolut: Market-rate conversion with no commission up to a monthly limit (approximately EUR 1,000 on the free plan). Best suited to smaller amounts and real-time rate monitoring.
• N26: German bank with an EU IBAN, accepts CHF credits and enables conversion. Useful as a transit account for workers who receive salary into a Swiss account.
• Swiss bank → Italian bank via SEPA transfer: The most expensive method (spread 1.5–3%). Retain as a fallback for large one-off transfers where the convenience justifies the cost.

On timing: The CHF historically tends to strengthen during periods of global uncertainty — early in the calendar year, around major European elections, or during geopolitical tension — and to soften modestly in risk-on market phases. Converting your entire monthly salary on the same fixed date every month is not necessarily optimal. A simple monthly review takes five minutes.

Real income impact: If your gross salary is CHF 60,000 per year and the EUR/CHF rate oscillates between 0.95 and 1.05, your effective income in EUR can vary by EUR 3,000–4,000 at identical gross Swiss pay. For many cross-border workers, managing the currency conversion is the second most impactful lever on disposable income — after salary negotiation itself.

Reference information

• Italian residents holding multi-currency accounts abroad must declare them in the RW schedule of their Italian tax return if the average annual balance exceeds EUR 15,000. Below that threshold, no declaration is required.
• Exchange commissions are not tax-deductible in Italy.
• Swiss-source employment income remains subject to Swiss withholding tax or ordinary assessment under the 2026 New Agreement framework.

Source: tio.ch

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