Partial revision of the value-added tax

The revised Value Added Tax law finally comes into effect after lengthy debates and adjustments – an important step towards optimization and fairness.

2017

Since January 2010, the completely revised Value Added Tax Act has been in force. However, its further development has been continuously discussed since its introduction. This is now to take place with the partial revision. The draft has been approved by Parliament and the referendum period has expired. Learn in this article what the partial revision involves.

Previous Development

‍In June 2008, the message for simplifying the value-added tax was adopted. This project was divided into two parts (Part A and Part B). Part A, which has been in force since January 1, 2010, aimed to simplify the systematics. For the second part, the Federal Council initially proposed a new uniform VAT rate, along with the abolition of most VAT exceptions. This was rejected by Parliament and referred back to the Federal Council. The Federal Council's second proposal of a two-rate model, as initially desired by Parliament, was also rejected by Parliament in autumn 2013. In February 2015, the Federal Council presented a new draft. This involves a partial revision of the Value Added Tax Act. The goal is to optimize, using the experience gained since 2010, and to reduce the competitive disadvantages of domestic providers.

What's coming next?

‍The partial revision aims to eliminate the disadvantages of domestic companies compared to foreign companies. Specifically, changes are planned in the area of taxable parties, tax exemptions, procedures, and data protection. For example, companies making more than 100,000 CHF in annual sales with services that are not VAT-exempted will now be subject to VAT. This now focuses on global turnover rather than just domestic turnover. Also, online retailers based abroad will now be required. If they achieve a turnover through import tax-exempt small shipments that exceeds 100,000 CHF per year, they must charge VAT to their Swiss customers in the future.

As a result of these measures, about 30,000 new taxpayers and a total of 62 million francs in additional revenue are expected. The referendum period, which lasted until January 19, 2017, expired unused. The enforcement is currently scheduled for January 1, 2018.

Source: Federal Department of Finance

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