Switzerland approves increasing VAT rates in 2024

The world of VAT is constantly moving and changing; the most recent updates concern Swiss VAT rates. However, this update also comes with the news that Switzerland has approved a Swiss e-filing portal. Here’s what your business needs to know about the upcoming changes and how to best prepare for them. 

VAT reclaim in Switzerland

As Switzerland is not a part of the European Union, it sets its own VAT rates. This means that suppliers of goods or services VAT registered in Switzerland must charge the appropriate VAT rate. However, certain industries are exempt from Swiss VAT including insurance, financial services, education, and health. 

VAT-registered businesses in an EU member state and VAT-registered businesses outside of the European Union are eligible to recover VAT on business costs from Switzerland. However, the reclaim process will differ for each. Whether your business is based in the EU or not, you will either fall under the EU VAT Refund Directive or the 13th Directive.

For more information on VAT reclaim in Switzerland, download our VAT refund guide to Switzerland. 

Newly approved VAT rates for Switzerland: 

Following the voting procedure that took place on 25 September, Switzerland has approved an increase in all VAT rates. These changes are expected to be enforced from January 2024. However, The Swiss Federal Council will only confirm the implementation dates in December 2022. 

Here’s what businesses need to know about the upcoming change. 

Background

The Swiss voters proposed the VAT rate increase to address the funding shortage in the Swiss Pension System. Although the National Council and the Council of States had already voted in favour of the increased rates in December 2021, the increase was still required to undergo a mandatory voter referendum. On 25 September 2022, the rates in question were approved by a 55.07% majority.

The approved increased VAT rates

The standard VAT rates will increase as follows: 

• Standard VAT rate: From 7.7% to 8.1% (+ 0.4%)
• Reduced VAT rate: From 2.5% to 2.6% (+ 0.1%)
• Special VAT rate for accommodation: From 3.7% to 3.8% (+ 0.1%). 

Companies operating in Switzerland must proactively follow these changes to ensure they have enough time to implement them in their business operations. 

Along with the approved VAT rate increase, the Swiss Tax authority has also announced its plans to replace the “ESTV SuisseTax” online platform with the “ePortal.” 

Updates to the e-filing portal

This change is expected to take effect from the beginning of November 2022. This shift is geared towards centralising all VAT-related services to one single portal. The new ePortal will cover VAT declarations, VAT returns, and VAT certificates.

Concerning the transition between the SuisseTax platform to the ePortal, the Swiss Tax Authority has stated that the switch will require no additional effort from users. As soon as the transition is complete, the user will automatically be forwarded to the ePortal. 

For more information about the transition from “ESTV SuisseTax” to “ePortal,” reach out to our experts to ensure you’re in the loop and 100% compliant. 

Confident Swiss VAT reclaims with VAT IT

Do you need assistance with your VAT refunds in Switzerland? Allow VAT IT to process your refunds quicker and attend to any unforeseen VAT authority queries that may arise. Get in touch with our experts, and rest assured that all your Swiss VAT obligations are taken care of.