Various anti-immigration measures have been proposed in Switzerland in recent years including one that would make new arrivals pay 50,000 francs. Critics say the people behind these measures ignore the important economic role immigrants play in Switzerland.
Anti-immigrant measures proposed in Switzerland in recent years include an initiative by right-wingers, called ‘No to Switzerland of 10 million people’ (which is yet to be voted on), calling for the Federal Council and parliament to stop the influx of foreigners when the permanent resident population exceeds 9.5 million (it currently exceeds 9 million).
Another proposal put forward in 2024 focuses on charging immigrants a hefty tax — 50,000 francs — for the privilege of living in Switzerland and using its excellent infrastructure and other benefits.
The idea was originally devised by Reiner Eichenberger, professor of Theory of Financial and Economic Policy at University of Fribourg.
“Those who immigrate to Switzerland have an enormous gain in wealth,” he said in an interview with Neue Zurcher Zeitung in October 2023.
He argued that young Swiss citizens forego a year of work or study to perform the compulsory military service — losing income while they are serving their country.
He calculated that loss at between 50,000 and 80,000 francs over the course of their working lives.
This is how Eichenberger arrived at the proposed ‘foreigner tax’ of 50,000 francs, which, he said, is “equal to the burden” of those performing the obligatory army service.
READ ALSO: Why foreigners should pay ‘50,000 francs’ to settle in Switzerland
Opponents of this idea — including the business lobby — criticise the fact that the suggested tax focuses only on the costs of immigration, while ignoring the vital role of immigrants for the Swiss economy, including the contribution they make towards financing the country’s infrastructure and welfare system through the taxes they pay (read more about this below).
From workforce to innovation
In fact, foreign nationals play a pivotal role in many aspects of life in Switzerland, fulfilling the needs not only of the economy, but also of Swiss society as a whole.
While their contributions are multi-faceted, they have a major impact in these areas:
Employment
Swiss labour market has been in the throes of a labour shortage for quite a while, as employers in various sectors can’t find skilled workers to fill the job vacancies.
Experts say this scarcity of personnel will result in lower productivity, affecting economic development and, consequently, the country’s prosperity as well.
That is why Switzerland needs foreign employees to fill these gaps.
According to the Federal Statistical Office (FSO), in 2024 1.8 million foreigners were working in Switzerland, boosting the labour market and economy — but not only.
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Another important contribution immigrants make…
Public finances and social system
Foreigners who are gainfully employed in Switzerland pay taxes, which fill their municipal, cantonal, and federal coffers.
They are also paying into the obligatory social security scheme, which means they have had a positive effect on the state pensions.
As a matter of fact, according to research carried out by Universities of Zurich and St. Gallen, immigrants pay proportionally more into the AHV/AVS, disability, and unemployment insurance schemes than they receive in benefits.
In 2023, “persons born abroad paid more than 40 percent of the total contributions, while receiving less than 30 percent of the benefits,” the study found.
On the other hand, “persons born in Switzerland paid less than 60 percent of the contributions, but received more than 70 percent of the benefits.”
Switzerland’s own State Secretariat for Economic Affairs (SECO) has laid out how much more foreign workers contribute to the welfare system.
In terms of disability insurance, foreign nationals paid 26.5 percent into the scheme, receiving only 14.9 percent of benefits in return.
With regard to the compulsory health insurance, SECO assumed “that most EU nationals in Switzerland are currently of working age and in fairly good health. They therefore represent an advantage” to the system.
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Innovation
According to the Global Innovation Index 2024, Switzerland has been the most innovative country in the word 14 times in a row.
But Swiss citizens are not the only ones who deserve high praise for this accomplishment.
“We examined the share of foreigners in all areas that are important for Switzerland’s ability to innovate and found that they are responsible for almost half of all innovations,” said Patrick Leisibach, migration expert at the Avenir Suisse think tank.
Here are the numbers: with a population share of 26 percent, foreigners represent 39 percent of all company founders, 50 percent of all start-up founders , and 37 percent of all innovators.
At universities, 51 percent of professors have a foreign passport.
“In reality, the effect of immigration is probably even greater,” Leisibach pointed out.
He added that his research into this matter showed that “immigration plays an important role in all areas. There is no aspect of innovation that is entirely in Swiss hands.”
