In a national referendum held on Sunday, Swiss voters have shown strong support for implementing a global minimum tax on businesses and a climate law aimed at reducing fossil

fuel consumption and achieving zero emissions by 2050, according to public broadcaster SRF.

The referendum results revealed that 79% of the participants favored raising Switzerland's business tax to the global minimum rate of 15% from the current average minimum of 11%. Additionally, 59% of voters supported the climate law.

Switzerland had already joined nearly 140 countries in 2021 by signing an agreement with the Organisation for Economic Cooperation and Development (OECD) to establish a minimum tax rate for large companies, with the objective of curbing profit shifting to low-tax jurisdictions.

Even with this tax increase, Switzerland will still maintain one of the lowest corporate tax levels worldwide. The proposal, projected to generate an additional 2.5 billion Swiss francs ($2.80 billion) in annual revenue, garnered support from business groups, most political parties, and the general public.

The climate law, reintroduced in a revised form after being rejected in 2021 due to perceived high costs, sparked further debate. Proponents argue that the law represents the minimum action required for Switzerland, a wealthy country, to demonstrate its commitment to combatting climate change. However, opponents from the right-wing People's Party express concerns about potential energy security risks.

In addition to endorsing the global minimum tax and climate law, voters also approved the extension of certain provisions in the country's emergency COVID-19 law, in line with Switzerland's system of direct democracy, which mandates public voting on legislation.

Switzerland hosts the offices and headquarters of approximately 2,000 foreign companies, including major players like Google, as well as 200 Swiss multinational corporations such as Nestle. While all these entities would be affected by the new tax regulations, business groups have expressed satisfaction with the increased certainty that the measures would bring, even if Switzerland loses some of its appeal as a low-tax destination.

Christian Frey from Economiesuisse, a lobbying organization, stated, "No other country will have lower taxes either. We want the additional tax revenue to remain in the country and be utilized to enhance its attractiveness for businesses." Photo by Elwood j blues, Wikimedia commons.