The legislative roadmap released by the Vaud Council of State on 1 November 2017 confirms a substantially reduced corporate tax rate of 13.79% in the canton of Vaud as of 1 January 2019, irrespective of the Federal Tax Proposal 17 currently under way.
The Vaud Council of State has confirmed its intention to introduce a massively reduced corporate tax rate – regardless of the current corporate tax reform under way at the federal level. In issuing this confirmation, Vaud has sent out a strong positive message to its taxpayers. While the other cantons are waiting, this clear position enables the canton of Vaud to give visibility and certainty to companies domiciled there.
The Vaud authorities will implement within the coming months a cantonal package, including a reduction in the corporate income tax rate. As of 1 January 2019, the income tax rate will be decreased from 20.95% to 13.79%. This represents a very significant fall for all companies − SMEs and others − in the canton of Vaud that do not benefit from a privileged tax regime.
On the other hand, this new ordinary tax rate will also be applicable in the long run to companies that have enjoyed privileged status so far. Until a federal tax reform is implemented, however, these companies will remain subject to a tax rate comparable to that applicable today.
Either way: All Vaud-based companies need to assess carefully how the new tax rate will impact them, including identifying any opportunities in terms of investments, disposals and accounting/reporting.
KPMG will continue to keep you up to date regarding this key economic topic.
Our Services and further information:
- Vaud press release
- Article: Canton of Vaud to offer companies a competitive tax framework
- Article: Tax Proposal 17 – Start of consultation procedure
- Clarity on Swiss Taxes
- Corporate Tax Services at KPMG