Eric: You are a proper Swiss, Bertrand, right?
Bertrand: What do you mean proper? Are you judging my swissness?
Eric: relax, dude. All I’m saying is, can you vote?
Eric: I need a favor. Can you setup a referendum for me for the people to vote?
Marc: What? It’s not that simple, my friend. You have to be the government to do this.
Eva: marc, you are wrong. Eric is right. This time. For a change. Anyone can create a referendum or an initiative for voting, to be more accurate. I was reading about that the other day at ch.ch. Anyone with voting rights in Switzerland can launch a referendum as long as they collect and submit to the Federal Chancelery 50,000 signatures from valid voters within 100 days. And it has to be related to a law or something to take place or put in action in the canton or the country. If you are just asking the opinion of the Swiss voters on the last episode of game of thrones then use surveymonkey or something.
Bertrand: What is your voting about, Eric?
Marc: I think I do not want to listen about this. Specially not over breakfast. Let me enjoy my salad. Plus we are sitting at a table with others. Pain Quotidien is not the right place for Eric’s topics.
Bertrand: I loved the post that Eva did last year on the most weird referendums we ever had.
Eva: Thank you, babe. Most popular, not most weird. Actually there is a referendum that is coming up this year that it might change the lives of all of us.
Eva (eyes rolling at him, followed by ignoring him and turning to the others): the CTR III or RIE III for Canton de Geneve. Now this is an interesting topic to discuss. What do you think? Yes or No?
And this is how a passionate and constructive started…
But let me bring you up to speed, in case you have followed these critical developments. In my own way. Simple and impartial. Or at least these are my intentions.
The Corporate Tax Reform III or Réforme de l’Imposition des Entreprises III is about equalizing the taxation for all companies in Switzerland at a standard rate of 13% for the Geneva canton. There is a different rate decided by canton. Now this is quite controversial. Not as obvious, but it is. Because there are companies that pay less and companies that pay a lot more today. There are lots of opinions and several implications. Here are the most important ones:
There are international companies, representing 7% of all companies in the canton, today that have tax rates around 11%, with some going lower than 5%! These companies contribute 15% of the Geneva canton value, bringing around 1.1 billion Swiss Francs and employ (directly or indirectly) around 60,000 people. If they decide to go? Luxembourg, Malta, Ireland, Gibraltar, Bulgaria, anyone? If they go, the life of the canton will change, to say the least. The economy of the canton will crash, from the real estate market to commerce and beyond. Most importantly I don’t want my friends to go…
The majority of the companies, mostly Swiss, pay today 22% taxes and they will benefit of 9 points of reduction. Not bad for the Swiss economy, right? This will make these companies even more competitive globally. Cheaper products, better salaries for their employees, a stronger stock price. Should I buy their stock already? Hmmm. On the other hand, the lower tax rate will cost around 500 million Swiss francs to the canton.
Did I oversimplify? Not much. It does come down to the above. And as I was told many times in the past, “In life you can’t have it all. At least not at the same time. Everything comes with a price.”
For your information, Canton de Vaud already voted YES, with an impressive 87%, on March 20th of this year and they will move to a standard rate of 13.79% by 2019. Our referendum in Geneva will take place some time in September of this year…
What do you think?