(Nov 30): Switzerland voted to reject a 50% inheritance tax on super-rich residents after wealthy entrepreneurs threatened to leave the country.
Some 82% of the electorate opposed the plan, according to a preliminary government estimate on Sunday. Polls ahead of the plebiscite had suggested such an outcome.
The left-wing Young Socialists group launched the proposal as a way of raising funds to fight climate change. The levy would have been introduced on all assets exceeding 50 million francs (US$62 million or $80.4 million), which an individual passes on or gifts. That would have hit some 2,500 people in Switzerland — the top 0.03% of the population.
The plan ran into staunch opposition from the government and all parties aside from the left. They argued that the tax risked the departure of wealthy people, offsetting any proceeds and leaving fiscal coffers worse off.
Stadler Rail AG top shareholder Peter Spuhler was among the rich entrepreneurs who said he’d emigrate should the measure pass, telling local media that the levy would force his company to be sold in case of his death.
Switzerland — which already has wealth taxes — has more than nine billionaires per million inhabitants, five times the average in western Europe, according to a UBS study. It also has special provisions for well-heeled foreigners that allows them to pay taxes without fully disclosing what they own. The fiscal benefits from such resident millionaires are likely to have swayed voters in Sunday’s ballot.
See also: Navigating client relationships with AI
The rejection also eases some concerns that the nation’s status as one of the world’s top places for the wealthy may be slipping. The reputation — nurtured by the high-net-worth focus of its banking industry and the fiscal policies of some cantons — is being tested by competition from other centers in Asia and the Middle East.
Swiss citizens — who vote in plebiscites as many as four times a year under the country’s direct-democracy rules — have repeatedly sided with business interests. In past years they rejected measures on stricter emission limits, a national minimum wage, and more mandatory vacation days.
In a separate ballot, voters decided that service in the Swiss army should remain mandatory only for men.
See also: The trillion-dollar business of wealth
The proposal by a centre-left coalition aimed to extend the duty to women, while enabling anyone to fulfil the obligation also by civilian service like caring for the elderly or environmental work. The plan garnered just 14% support.
Uploaded by Magessan Varatharaja
