Simplicity of tax systems: Switzerland ranked 20th

In the international comparison, the Swiss tax system ranks 20th in terms of the simplicity of tax systems. In the European context, it ranks 7th out of 32. However, it has not yet fully exploited its potential for an attractive location. This is shown in the "Paying Taxes 2019" study by PricewaterhouseCoopers (PwC) and the World Bank.

In the new edition of the "Paying Taxes" study, the tax systems of 190 countries worldwide were again compared using a standard SME based on the indicators total tax burden, time spent fulfilling tax obligations, and number of tax payments. These three metrics serve to calculate the overall indicator "Ease of paying taxes": the simplicity of the tax system. More and more countries are introducing online platforms to simplify tax collection. This led to a global average reduction of three hours in the effort companies put into their tax obligations, which now totals 237 hours. In EU and EFTA countries, the time spent remains at an average of 161 hours. Here Switzerland scores with 63 hours, which an SME spends on the tax declaration. However, in Switzerland the number of taxes collected is higher than in the other 31 states in Europe. On average, 12 different taxes are collected in Europe, while in Switzerland there are 19. However, it has improved its rank from 28 to 11 compared to last year. In the so-called "post-filing index," the effort involved in refunding value-added tax and a subsequent correction of a tax declaration for profit taxes was measured. Here Switzerland ranks 13th out of 32. The reason for this is that in the European comparison, the payout of tax credits is relatively late, and that the assessment system for profit tax is administratively rather cumbersome.

In the global ranking of the overall indicator "Ease of paying taxes," Switzerland ranks 20th. In the European context, Ireland, Denmark, and Finland occupy the top three places. They are followed by Latvia, Estonia, Lithuania, and Switzerland in seventh place. "Switzerland continues to be well-positioned in the international context, but must be careful not to fall behind," explains Armin Marti, Head of Tax Policy at PwC Switzerland. Digitizing the tax declaration process could help here and further increase efficiency.

Source: "Paying Taxes 2019" study, PricewaterhouseCoopers (PwC) and World Bank

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