ZURISH: Switzerland can retain its appeal as an attractive base for multinational companies even if the US lowers its corporate tax rates, Finance Minister Ueli Maurer said.
“I’m of the view that the US will do something on corporate taxes because they’re very, very high, and with a favourable tax regime they can attract back certain companies,” Maurer said in an interview in Baden-Baden, Germany. “But their room to manoeuver isn’t infinite because their government debt is so high.”
Maurer was in Germany to attend a meeting of finance ministers and central bankers of the Group of 20, in which countries pledged to work for a fair and modern tax system. That includes an Organisation for Economic Cooperation and Development initiative to prevent the use of legal loopholes allowing companies to artificially shift profits to countries with lower or no taxation.
US President Donald Trump proposed during the campaign to cut the US corporate income tax to 15% from 35%, the highest in the industrialised world.
Switzerland has committed to reforming its corporate tax system. Yet the government has been sent back to the drawing board on what to replace it with after voters rejected an initial plan in a referendum in February.
“There’s great understanding and no opposition,” Maurer said of how the plebiscite and the government’s bid to come up with a Plan B were being received by officials of other countries.
The government in Bern expects to lay out the key points of a revamped plan in June, Maurer said.
Although it was still too early to talk about details, he said keeping Switzerland attractive for companies is a prerequisite. “We will continue to be in the top group,” he said. “We have a lean, cost-efficient state and we have no or few debts.” – Bloomberg