SWITZERLAND Law and Practice Contributed by: Joseph Merhai, Thomas Pasquier and Laurent Schenker, Aegis
within the OECD/G20 Inclusive Framework Task Force on the Digital Economy have been ongoing since November 2021, but no final Pillar One package has yet been adopted. Switzerland has consistently supported consensus- based decision-making within the Inclusive Frame - work. The State Secretariat for International Finance (SIF) has participated in the negotiations and rep - resented Switzerland’s positions. If Pillar One were adopted at Inclusive Framework level, the Federal Council would decide whether Switzerland should sign the MLC. For subsequent ratification, approval from the Parliament would also be required, and any ratification would require parliamentary approval. 4.3 Pillar Two In January 2022, the Federal Council decided to intro - duce the minimum tax rate by way of a constitution - al amendment. A referendum was held on 18 June 2023, and the constitutional basis was approved. Despite calls from political and economic circles to defer implementation until 2025, the Federal Coun - cil enacted a temporary ordinance with effect from 1 January 2024, introducing the qualified domestic minimum top-up tax (QDMTT). On 4 September 2024, the Federal Council decided to bring the Income Inclusion Rule (IIR) into force with effect from 1 January 2025. The Federal Council has six years to present a federal law that will replace the ordinance. Due to international criticism, Switzerland has decided to postpone the entry into force of the Undertaxed Profits Rule (UTPR). On 12 September 2025, the Federal Council adopted the dispatch approving the international legal frame - work for the exchange of information under the OECD minimum tax. The exchange of information is expect - ed to enter in force no earlier than 1 July 2026. 4.4 Specific Features or Deviations of Pillar Two Switzerland has implemented the global minimum tax broadly in line with the OECD framework. Under this system, the IIR imposes a minimum effective tax rate
of 15% on the profits of large multinational groups that generate a global turnover of at least EUR750 million. Based on the current Swiss implementation, there are no material deviations from the OECD framework. 4.5 Digital Services Tax Switzerland has not introduced a specific tax on digital services or streaming services, adopting the position that the digital economy should be addressed through a multilateral solution. Switzerland therefore focuses on the OECD/G20 Inclusive Framework process and refrains from unilateral measures, especially if they fall outside the scope of DTAs. 5. Anti-Avoidance and Anti-Evasion Measures 5.1 Definition and Identification of Tax Fraud, Evasion, Tax Avoidance and Abusive Swiss law distinguishes between tax evasion, tax fraud and tax avoidance, and these concepts apply equally in domestic and cross-border situations. Tax evasion (soustraction fiscale/ Steuerhinterziehung) This covers situations where a taxpayer, intentionally or through negligence, causes a tax assessment not to be carried out when it should have been, or causes an assessment that has become final to be incom - plete. Tax evasion is punishable by a fine, generally set between one-third and three times the amount of tax evaded, depending on the circumstances, includ - ing the gravity of the fault, the co-operation of the taxpayer, etc. Tax fraud (fraude fiscale/Steuerbertrug) This is a specific offence and involves the use of falsi - fied or materially incorrect documents with the intent to deceive the tax authorities. In particular, anyone who uses falsified or untrue documents (eg, balance sheet, profit and loss statement, salary certificate or other attestations) with intent to mislead the tax authorities is potentially liable to a jail sentence of up to three years and/or a fine. Schemes Definitions
468 CHAMBERS.COM
Powered by FlippingBook