The adoption of the tax bill on 19 May 2019 has far-reaching consequences that will take effect from 1 January 2020. We will briefly summarise the most important points for you.

Abolition of holding company privilege

Special-status companies, which are no longer tolerated internationally, will be abolished. In the SME sector, this particularly affects holding companies, which will also be subject to cantonal profit tax from 2020.

Research and development

As a replacement for the abolished tax privileges, the legislator has decided on the internationally recognised, tax-based promotion of research and development. Domestic research and development expenses may be allowed as a tax deduction up to 50% above the expenses justified by the business. In addition, income from patents is to be taxed at a privileged rate.

Dividend taxation

Income from participations will now be partially taxed at 70% instead of 50% at the level of direct federal tax. This will make income from participations more expensive for owners of joint-stock companies.

Reduction of profit taxes

As a compensatory measure, individual cantons have decided to reduce profit tax for companies, with the canton of Bern rejecting the tax law revision in October 2018 and taking last place in profit tax rates for legal entities from 2020.

Financing of the OASI

The tax bill is linked to securing the financing of the OASI. An additional 0.3% of the wage liable for OASI contributions is to be paid. Wage earners will thus receive a lower 0.15% net wage, while employers will have to pay 0.15% more in levies.

Conclusion

The tax landscape continues to change and will remain dynamic in the coming years. At the national level, the increase in VAT to finance the OASI will probably be voted on next year.
After the failed revision of the tax law, the canton of Berne is planning another bill that will unfortunately not offer any relief for companies, but will provide more relief for families.

We will stay on the ball for you and will be happy to answer any questions you may have.