class=”sc-cffd1e67-0 iQNQmc”>
Not again! Anyone who opens the mailbox these days can become irritated: their tax return has to be submitted. The cantons, on the other hand, can be happy. Because the ruble rolls.
In recent years, the cantons have benefited enormously from tax revenues – more than they expected. The liberal think tank Avenir Suisse has calculated that they have budgeted far too pessimistically for the past seven years. The game is the same every time: the cantons usually take losses, but ultimately make big profits.
Geneva miscalculated by almost 2.3 billion
In 2021 alone, the cantons had miscalculated by as much as 8.3 billion francs, and the following year this was again 7.7 billion francs. The canton of Geneva, for example: it budgeted a loss of 820 million francs for 2022 – this turned into an increase of 1,451 million francs.
Avenir Suisse is bothered by this: “If the state systematically takes in more than it spends, we pay too many taxes in relation to the services we receive,” says research director Lukas Rühli. He evaluated the cantons’ figures from 2016 to 2022.
Let’s take the example of Basel-Stadt: the city canton could have lost 3,171 francs per household year after year without being in the red. In the canton of Zug it is 2,654 francs. “Many cantons have the potential for a tax reduction,” says Rühli.
Tax cuts are politically difficult
The excessive tax bills are usually not a sign of ill will. “On the one hand, it is very difficult for the cantons to estimate corporate taxes,” Rühli explains. In Basel-Stadt, the pharmaceutical giants Roche and Novartis have a decisive influence on tax flows.
On the other hand, the National Bank’s irregular payments are difficult to predict, says Rühli. But that is not to be expected, at least not this year. Due to the lack of foreign currency, the National Bank is making losses.
Alternative solution: tax refund
The fact remains: if the cantons make a profit, the taxpayers are actually entitled to it. But across-the-board tax cuts are controversial. Politicians fear that there will be a shortage of money in bad years. Avenir Suisse therefore proposes another solution for unexpected profits: a tax refund. If a canton receives an unexpected amount of money and does not have heavy debts, it must offset the surplus against the final tax bill.
“In this way, taxpayers get back the money they are entitled to,” Rühli explains. Only the six cantons of Baselland, Geneva, Jura, Neuchâtel, Ticino and Uri have too high a debt for this. “It would make sense for them to reduce their debt first.”
Also, refunds to taxpayers may only be made if an unexpected profit is made. “Governments must continue to have access to the profits themselves, but they must first consciously budget them,” says Rühli.
He hopes that this solution can encourage the cantons to calculate more accurately. But the opposite is also conceivable: that the budgets are calculated even more ‘pessimistically’, because in the event of a positive surprise, the money will flow back to the taxpayers. Rühli says: “But if there are unplanned gains several years from now, across-the-board tax cuts become a problem again.”
The cantons admit that there were incorrect assessments
The cantons openly admit that they miscalculated. But you can’t hit everyone with one baton. “The situation is different,” says Ernst Stocker (68, SVP financial director of Zurich). He is chairman of the financial directors of the cantons. You should not have expected from the outset that the economy has developed positively in recent years.
“It’s better to be safe than sorry, especially these days,” Stocker says. “Budgeting is done to the best of our knowledge and belief.” No government collects taxes if it is clear in advance that the money is not needed.
How the cantons will use the surplus must be decided democratically. Stocker considers Avenir Suisse’s proposal to be “creative.” But: “Ultimately, democratic decisions by citizens are necessary.”
Source:Blick
I am Liam Livingstone and I work in a news website. My main job is to write articles for the 24 Instant News. My specialty is covering politics and current affairs, which I’m passionate about. I have worked in this field for more than 5 years now and it’s been an amazing journey. With each passing day, my knowledge increases as well as my experience of the world we live in today.
