Following the Council of States, the National Council has also decided by a large majority not to consider the proposal to introduce a tonnage tax. Switzerland is thus waiving the introduction of the internationally recognized method of calculating profits for high seas vessels.
On May 28, 2024, the National Council decided by 108 votes to 75 with two abstentions not to enter into the bill on the federal law on tonnage tax on high seas vessels. The Council of States had already decided not to enter into the corresponding bill in March. The National Council is thus changing its position on the introduction of a tonnage tax. In December 2022, the National Council had expressed a fundamentally positive view of it.
Draft bill and criticism
The bill provided for profits from the operation of seagoing vessels to be taxed at the federal, cantonal and municipal levels based on the net tonnage (loading capacity) of the vessels and not on the net profit of the shipping companies which would have led to tax advantages.
The bill was controversial, among other things, due to constitutional concerns. However, the Federal Council was of the opinion that the introduction of a tonnage tax would have been justifiable in view of economic policy interests.
Switzerland is not keeping pace with tax competition
The tonnage tax is considered an internationally recognized instrument for promoting ocean shipping. Such instruments are in force in the majority of EU countries. Even considering the introduction of the OECD minimum tax, the lower tonnage tax would have been generally attractive, as the GloBE model rules exclude income and qualified ancillary income from international shipping from the calculation of the GloBE income.
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