Tax Clash: Challenging Tax Voracity in the Canton of Vaud (cross-border guide)

Context

In a nutshell

• The 12% initiative proposes a 12% discount on cantonal income and wealth tax. - The 12% tax reduction could have a significant impact on the middle class and the economy of the Canton of Vaud.

Key facts

• What: 12% cantonal tax initiative. - When: Submitted for the vote on 27 September. - Where: Canton Vaud. - Who: Supporters of the initiative. - Amount: 12% discount on cantonal tax.

The Canton Vaud government has proposed a more gradual alternative plan to reduce taxes, but supporters of the 12% initiative argue that it is too slow and does not solve the problem of fiscal greed in the Canton Vaud.

The context

Canton Vaud is one of the main Swiss cantons in terms of GDP and population. Its economy is mainly based on the financial sector, which accounts for about 30% of GDP. However, the growth in public spending and taxes has led to a reduction in the competitiveness of the Canton of Vaud compared to other cantons and countries.

Supporters of the initiative

Supporters of the 12% initiative argue that the 12% tax cut will be an important stimulus for the economy of the Canton of Vaud. According to them, reducing taxes will help create new jobs, increase productivity and improve the quality of life of citizens.

Opposites

Opponents of the 12% initiative argue that the

Operational details

The 12% initiative proposes a 12% discount on cantonal income and wealth tax, with the aim of reducing the tax burden on the middle class and the economy of the Canton of Vaud. Supporters of the initiative argue that the alternative plan proposed by the government is too slow and does not solve the problem of fiscal voracity in the Canton of Vaud. Taxation is a problem felt in the lake region of the Canton of Vaud, where taxation is among the highest in Switzerland. According to data from the Federal Statistical Office (FSO), in 2020 the Canton of Vaud collected 3.4 billion francs in income taxes, 12.5% more than in 2015. This increase was largely due to the increase in capital gains taxation. The 12% initiative proposes to reduce the tax burden on natural and legal persons residing in the Canton of Vaud. According to the calculations of the supporters of the initiative, an income of 50,000 francs per year would have been taxed with a tax of 4,200 francs in 2020, compared to the 3,720 francs foreseen with the 12% initiative. This means that a self-employed person with an income of CHF 50,000 per year could save CHF 480 per year thanks to the initiative. The alternative plan proposed by the government envisages reducing the tax burden more gradually, with an increase in the income tax exemption threshold from CHF 20,000 to CHF 30,000 in 2025. According to the calculations of the The issue is also discussed by public finance experts. According to Jacques de Haller, professor of public finance at the University of Bern, "the tax burden is a problem felt in the lake region of the Canton of Vaud, where taxation is among the highest in Switzerland. The issue is also being discussed by federal politicians. According to the Minister of Economy, Guy Parmelin, "the tax burden is a problem felt in the lake region of the Canton of Vaud, where taxation is among the highest in Switzerland.

Key points

Supporters of the 12% initiative call on the citizens of the Canton of Vaud to vote in favor of the initiative to reduce taxes and help the middle class and the economy of the Canton of Vaud. The vote will take place on September 27. This initiative aims to reduce the tax burden on households and businesses, ensuring that Canton Vaud can compete with other Swiss cantons, such as Canton Ticino or Canton Grisons, which have already implemented tax reduction measures.

The initiative's proposal of 12% provides for a reduction in the municipal tax of 12% for families and businesses. This would mean savings of about CHF 150 million for households and businesses in the Canton of Vaud every year. This could help stimulate economic growth and create new job opportunities, such as in the technology innovation sector, which is very active in Lausanne and Geneva.

In addition, the 12% initiative aims to simplify the tax system of the Canton of Vaud, reducing the number of taxes and contributions that households and businesses have to pay each year. This could help reduce the tax burden and improve the transparency of the tax system, as required by the Federal Public Finance Transparency Act of 2017.

The Electoral Commission of the Canton of Vaud has already issued an ordinance regulating the electoral campaign and the voting methods for the 12% initiative. The vote will take place on 27 September,

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Source: tio.ch