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Tax proposal 17: Business location Basel-Stadt stays attractive and sustainable for corporate taxes

The Canton of Basel-Stadt adopted the parameters for an implementation of the tax proposal 17 on December 7th 2017. Corporate as well as individual taxes will be lowered. The cantonal government will strengthen investments for international companies as well as for SMEs by providing a long-term tax-planning horizon.

Competitive income taxation

With the implementation of the tax proposal 17 the effective income tax will be lowered to 13 per cent (incl. federal tax) and capital taxes to 1 per mil. As a result the Canton of Basel-Stadt remains an attractive business location for international companies after eliminating the old tax privileges. Ordinarily taxed companies, including many SMEs, will benefit from a considerably reduced tax burden.

Attractive location for research and development

The Canton of Basel-Stadt plans to introduce a patent box in line with OECD standards. With this measure, companies that invest in research and development in Basel-Stadt , will benefit from an additionally reduced tax burden.

Financially sustainable and socially balanced

The cantonal government plans to make use of the canton’s financially sound base: And proposes, in addition to the corporate taxes, to also lower the individual income tax rates annually by 30mil. Swiss francs per year. Together with the social compensation measures this may contribute to a high acceptance rate of the tax proposal 17 by the general public. These expected measures are in line with the financial plan of the Canton of Basel-Stadt.

Moving fast forward

On a Swiss national level, the Federal Council has presented the parameters for the tax proposal 17 on January 31st 2018. From a Basel perspective the planned parameters are positive: With the planned financial compensation and the mandatory patent box, the canton received the necessary instruments to implement the cantonal tax proposal as planned. The cantonal government requested the Federal Council to let the Swiss cantons implement the tax proposal if possible as of January 1st 2019.