Swiss MPs finally approved a reform of the longstanding legislation by allowing separate, rather than joint, taxation of spouses.
The individual taxation of married couples is to be introduced in Switzerland at last, having received the majority’s support in the parliament on June 3rd.
This move will bring closure to an issue that has been in legislative limbo for years.
That’s because married couples have been taxed jointly, mostly because in the past many women did not work.
Today, married couples are still taxed together, and that includes same-sex couples living in a registered partnership.
This means that if both partners are employed, they often have to pay higher taxes than unmarried couples filing their taxes separately. Their income is added (and taxed) together regardless of who made what.
That is good for the government, because more money is flowing into public coffers, but not so good for married people whose tax burden is high.
In fact, ‘tax penalties’ for married people are so high that the think tank Avenir Suisse asked in mid-2020, “why marry when living in sin is cheaper?”
But the push to change this system had been gaining momentum.
In February 2024, the Federal Council sent a proposal to the parliament, calling for a reform of the longstanding legislation by allowing separate, rather than joint, taxation of spouses.
Why has it taken so long for this measure to be approved?
That’s because MPs couldn’t agree among themselves on whether individual taxation is really best.
For instance, Philipp Bregy, a deputy from the Centre Party argued that such a move would put a huge burden on the cantons by creating a “bureaucratic monster.”
He cited the example of the canton of Zurich, which would have to create 150 new positions in the tax administration to process the new declarations.
Another MP, Paolo Pamini from the Swiss People’s Party, saw the proposed system as a threat to the traditional family and wanted to maintain the household as a “single economic entity.”
There was also the matter of a massive loss of tax revenue: the government predicted this measure, if implemented, to result in losses of 800 million francs a year in federal taxes and 200 million less in cantonal coffers.
For the Liberal-Radical deputies, on the other hand, the penalisation of marriage “must be removed from a societal and economic point of view.”
“The reform introduces tax fairness,” according to MP Beat Walti.
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What happens next?
The date for the introduction of the new system must still be set.
