The Swiss Parliament struggles to find agreement on important issues (cross-border guide)
The Swiss Parliament ended the summer session with little progress on crucial issues such as the financing of AVS pensions and agreements with the EU.
Contesto
In short - Swiss Parliament at a standstill on AVS and EU agreements - 13th AVS Financing: partial solution with VAT increase - Double majority for Bilateral III: open discussion - Nuclear: Parliament supports government counterproject ## Key facts - Financing of the 13th AVS annuity - Summer session 2026, Federal Palace, Bern - Federal Chambers involved - Requirement: 4-5 billion francs annually The summer session of the Swiss Parliament, which ended in Bern, saw little progress on crucial issues such as financing of the 13th AVS annuity and agreements with the EU. Among the most discussed dossiers, the financing of the 13th AVS old-age annuity has seen a partial solution, with a 0.4% VAT increase that will cover just over a billion of the 4-5 billion needed. ### AVS Loan The annual requirement for the 13th AVS annuity amounts to CHF 4-5 billion. The solution found by the Federal Chambers provides for an increase in VAT of 0.4%, generating about 1.1 billion francs. This means that the AVS will have to draw on its reserves for the next two years, raising concerns about the future of the Swiss pension system. AVS reserves, currently around CHF 40 billion, could decrease to CHF 36 billion by 2028. Operational checklist for AVS financing: - VAT increase of 0.4% (CHF 1.1 billion) - Use of AVS reserves (up to CHF 4 billion by
Dettagli operativi
Analysis of parliamentary decisions ### Impact on purchasing power The decision to increase VAT to partially finance the 13th AVS annuity will have a direct impact on the purchasing power of Swiss citizens. With a 0.4% VAT increase, the prices of goods and services will increase, reducing the purchasing power of Swiss households. For example, a household with an average income of CHF 8,000 per month in Zurich could see an annual increase in spending of around CHF 200, considering a basket of taxed goods and services. ### Future of the AVS The minimum solution found for the financing of the 13th AVS annuity increases the pressure for a global reform of the pension system. The AVS 21 reform, which came into force on 1 January 2024, has already introduced a gradual increase in the retirement age for women to 65. However, with the current insufficient funding, it is likely that there will soon be a new debate on raising the retirement age, with possible repercussions on future federal elections. Cantons such as Geneva and Vaud, with an older population, could be particularly affected by such changes. ### Agreements with the EU The issue of a double majority for Bilateral III is crucial for future relations between Switzerland and the European Union. If the double majority were to be approved, conservative cantons such as Schwyz or Uri, skeptical of Europe, would have greater weight, ## Useful planning tools To estimate your pension strategy, use the pension planner and the pillar 3 simulator.
Punti chiave
What to do now ## # Next steps for citizens Swiss citizens must follow the decisions of the Parliament and the Federal Council, which are planned for the coming months. For example, Parliament will discuss in September 2023 the AVS 21 reform, which provides for a 0.4% VAT increase to finance pensions. In Zurich, Geneva and Lausanne, cities with a high cost of living, this increase could have a significant impact on purchasing power. ### Monitoring Decisions Monitoring decisions is crucial. For example, the Federal Council has proposed an increase in VAT from 7.7% to 8.1% starting in 2024. This increase could generate about 1 billion additional Swiss francs per year for the AVS. Citizens can consult the official websites of the Swiss Parliament and the Federal Council to stay up-to-date. ### Preparing for the referendum In view of the possible referendum on increasing VAT, citizens should inquire. For example, in 2022, the Canton of Ticino saw a 6.5% increase in consumer prices. A further increase in VAT could aggravate this situation. See the official website of the Federal Council for details on the referendum. ## Useful tools To calculate the impact of the VAT increase on their purchasing power, citizens can use the calcolatore di imposte available on the Frontier Ticino website. ### Operational checklist - Inform yourself: Follow parliamentary discussions on Source: swissinfo.ch
Punti chiave
[{"q":"What is the impact of the VAT increase on purchasing power?","a":"The increase in VAT of 0.4% to finance the 13th AVS annuity will reduce the purchasing power of Swiss households, increasing the prices of goods and services."},{"q":"What could happen if a solution for financing the AVS is not found?","a":"If a solution is not found, the AVS will have to continue to tap into its reserves, raising concerns about the future of the Swiss pension system and potentially leading to an increase in the retirement age."},{"q":"What is Parliament's position on the new agreements with the EU?","a":"Parliament decided to postpone the decision on the double majority for Bilateral III, making it more difficult to approve the agreements with Brussels if the double majority were to be approved."}]
Frequently Asked Questions
- What is the impact of the VAT increase on purchasing power?
- The increase in VAT of 0.4% to finance the 13th AVS annuity will reduce the purchasing power of Swiss households, increasing the prices of goods and services.
- What could happen if a solution for financing the AVS is not found?
- If a solution is not found, the AVS will have to continue to tap into its reserves, raising concerns about the future of the Swiss pension system and potentially leading to an increase in the retirement age.
- What is Parliament's position on the new agreements with the EU?
- Parliament decided to postpone the decision on the double majority for Bilateral III, making it more difficult to approve the agreements with Brussels if the double majority were to be approved.