Every year the Swiss federal department of finance calculates the percentage of the tax base each canton will collect in tax in the coming year. Calculations for 2016 put Geneva in the lead with a tax burden of 34.2%, well above the Swiss average of 25.5%. The canton of Schwyz has the lowest percentage of 10.5%, sitting a the low-tax end of the ranking with Zug and Nidwalden, which all have percentages below 15%. Vaud, Jura, Neuchatel, Bern, Basel-City, Valais, Fribourg, Ticino and Solothurn are all above the average (see chart). Zurich, which accounts for around one fifth of Switzerland’s total tax base is on target to collect around 23% of its tax base in 2016.
Tax collected as a percentage of the tax base by Swiss canton for 2016 – source: Swiss federal department of finance
All cantons except Basel-Landschaft and Ticino will collect smaller percentages of their tax bases in 2016 than they did in 2015 (see chart). Overall Switzerland will collect 1% less of its tax base in tax in 2016. The leaders here are Luzern, Glarus and Nidwalden, which will all gather 2% less of the base than in 2015. The main driver of the fall in these percentages is rising tax bases, in particular rising wealth on which wealth tax is levied.
Changes in percentage of tax base collected by Swiss canton between 2015 and 2016 – source: Swiss federal department of finance
Overall all the tax base is rising across Switzerland, a positive development, particularly important for the canton of Geneva which has large debts. The newspaper Tribune de Genève shows the startling difference between the debts of the cantons of Geneva and Vaud. Vaud, with 8.3 billion of debt on its balance in 2003, now owes less than CHF 1 billion. In 2003 Standard and Poors, the US rating agency cut Vaud’s credit rating to A. Vaud responded to this wake up call and regained its AAA credit rating two years ago. Geneva by contrast has been deeply in debt for at least 13 years. In 2014 it owed CHF 13.4 billion and has a AA- credit rating.
The difference cannot be attributed to population differences. The canton of Geneva has a population of around 490,000 while Vaud has roughly 750,000 inhabitants.
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