\u201cIn terms of the chance for Switzerland to attract people leaving the UK, the damage has been done. The timing was terrible,\u201d said Georgia Fotiou, a lawyer advising private clients at Staiger Law. \u201cIt hasn\u2019t stopped everyone from coming but more have chosen Italy, Greece, the United Arab Emirates and elsewhere instead.\u201d<\/p>\n
The new tax was proposed by the far-left Young Socialists party in 2022 as a way of raising money to tackle the climate crisis. Under Swiss law, such proposals go to a public vote if they are backed by 100,000 signatures.<\/p>\n
\u201cThe whole country has to vote on the proposal just as a sheer consequence of the proposal being made, which creates unnecessary uncertainty,\u201d said Fr\u00e9d\u00e9ric Rochat, managing partner of Geneva-based Lombard Odier. \u201cThe simple fact it exists is unhelpful.\u201d<\/p>\n
Peter Spuhler, owner of rolling stock giant Stadler Rail and one of Switzerland\u2019s richest people, has publicly slammed the proposal as \u201ca disaster for Switzerland\u201d, saying his heirs could have to hand over as much as SFr2bn.<\/p>\n
The prospect of the new tax risks further denting Switzerland\u2019s reputation for stability, which has taken several hits in recent years including through the demise of Credit Suisse and the introduction of new financial regulations<\/a>.<\/p>\n \u201cSwitzerland was always the country with an excellent environment when it comes to gift and inheritance tax. We have some bigger family companies we consult and they would have a big issue\u201d if the proposal passes, said Stefan Piller, head of tax and legal for BDO in Zurich. <\/p>\n The new levy would place Switzerland above other jurisdictions such as Italy where inheritance taxes range between 4 per cent and 8 per cent, or Dubai and Hong Kong which have no inheritance or gift tax.<\/p>\n Business lobby group Economiesuisse said this week that the initiative \u201cendangers Switzerland\u2019s position as a reliable and stable business location internationally.\u201d<\/p>\n As the vote approaches, some people are already departing, while others are deciding against relocating to the country.<\/p>\n Rochat said Lombard Odier had \u201cseen Swiss-based families that have decided not to take any risk and to relocate ahead of the vote taking place\u201d, while overseas clients had decided not to move to the country because the \u201cextremely damaging\u201d proposal had created uncertainty ahead of the vote. <\/p>\n Another Zurich-based private banker said a top client had relocated to Liechtenstein ahead of the vote because, even if the proposal does not pass, \u201cthe uncertainty around whether there will be another one in a few years made them want to move\u201d. <\/p>\n However, other banks said plenty of wealthy people were still shifting money to Switzerland, long a haven in uncertain periods. <\/p>\n \u201cWe are seeing pretty big inflows from everywhere at the moment given global volatility,\u201d said a third executive at a private bank, adding that Americans<\/a> in particular had stepped up efforts to move money to the country under the Trump administration. <\/p>\n Recommended<\/p>\n
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