Switzerland’s Federal Council has warned that a proposal by the Young Socialists could lead to substantial tax losses and drive wealthy residents abroad, reported RTS. On Monday, it launched its campaign against the “For the Future” initiative, which will go to a vote on 30 November 2025.
The initiative, officially titled “For a socially just climate policy financed through fair taxation”, calls for a 50% levy on inheritances and donations exceeding CHF 50 million. The proceeds would fund climate measures. The initiators estimate the tax would generate around six billion francs annually—two-thirds for the federal government and one-third for the cantons.
President Karin Keller-Sutter, who also serves as finance minister, described the proposal as quite extreme. “A 50% tax above CHF 50 million is a lot,” she told RTS. Much of that wealth, she noted, is invested in businesses and machinery rather than held in cash. “Paying such a tax would often be impossible”, meaning that businesses cannot be turned into cash.
Concerns over federalism and fairness
The Federal Council says it shares the initiative’s climate goals but questions its funding model. A sustainable climate policy, Ms Keller-Sutter argued, requires “stable and efficient financing”—which the initiative fails to guarantee. The proposal, she added, undermines Switzerland’s federal system by overriding cantonal tax autonomy and provides no assurance that funds would be used effectively.
She also called the text inconsistent with the “polluter pays” principle, arguing that wealth does not necessarily correlate with emissions. “There are certainly very rich people who live modestly,” she said.
The initiative, she added, would not change their behaviour, but could harm small and medium-sized firms unable to meet the new tax obligations. Switzerland already spends around two billion francs a year on climate protection, she noted.
Risk of capital flight
The top 1% of Swiss taxpayers already contribute nearly 40% of total income-tax revenue—more than five billion francs a year. A new inheritance levy could prompt some of them, and the companies they control, to relocate, Ms Keller-Sutter warned, citing a federal analysis showing that wealthy individuals are highly mobile and often leave when inheritance taxes rise. The measure could also deter new high-income residents.
Recent tax changes in Britain highlight flight risk
According to Bloomberg, one of the architects of Britain’s recent tax crackdown on the wealthy has admitted that the policy may have gone too far. Arun Advani, director of the independent Centre for the Analysis of Taxation, said it was a mistake to impose an immediate 40% inheritance-tax charge on the overseas assets of non-domiciled residents. Since promising to extend inheritance tax (IHT) to the foreign holdings of non-doms, many of Britain’s wealthiest residents have reportedly departed. Data compiled by Bloomberg from Companies House show that more than 4,400 directors of UK firms have stepped down since the policy was announced. In April, when the changes took effect, departures were about 75% higher than a year earlier.
The initiators’ counter-argument
Julien Berthod, vice-president of the Young Socialists, dismissed such concerns as “meaningless”. “The bourgeois camp is trying to scare people into voting no,” he told RTS.
Only a tiny minority—some 2,000 to 2,500 people, or 0.03% of the population—would be affected, Mr Berthod said. He argued that the wealthy contribute too little to addressing the climate crisis despite their disproportionate impact. “The richest, with their private jets, yachts and investments in polluting industries, are major emitters,” he said.
At present, Switzerland levies no federal tax on inheritances or gifts, though nearly all cantons impose their own, generally exempting spouses and direct descendants. The share of inheritance and gift taxes in total public revenue places Switzerland around the middle of the pack among industrialised countries, according to federal data.
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