Switzerland moved a step closer to scrapping its so-called marriage tax penalty, a work in progress for around 25 years. This week, the National Council endorsed a compromise proposal for individual taxation, reported SRF. The reform—long sought by proponents of tax equity and gender equality—aims to align the tax system with modern household structures where both men and typically women work.
Under the proposal, each taxpayer would be assessed independently, a shift that supporters say will reduce disincentives to work, especially for second earners in dual-income households. Critics, however, argue it risks penalising traditional family models.
Thanks to a more progressive rate structure, the approved version, backed by a parliamentary committee, is expected to result in CHF 600 million less annual tax revenue, significantly lower than the CHF 870 million projected under the Federal Council’s original plan.
A minority faction, led by Leo Müller of the Centre Party, pushed unsuccessfully to retain the government’s original plan. The Council ultimately endorsed the committee’s version by a narrow margin—101 votes to 95.
Finance Minister Karin Keller-Sutter, serving as Federal President, acknowledged the reform creates both winners and losers, depending on household configuration and income level.
Proponents also note that the Federal Supreme Court ruled in 1984 that the marriage penalty violated constitutional guarantees. It’s time to correct an outdated system, said Céline Widmer of the Socialist Party, who framed the reform as a milestone for equal opportunity policy.
Opposition remains, particularly from the UDC/SVP and the Centre Party, which argue that the reform will simply replace one inequity with another. Traditional single-income families may face higher tax burdens, they say, while the administrative overhaul could prove costly and complex.
Parliament also weighed ancillary measures, including the controversial issue of transferable child deductions. By 130 votes to 66, it rejected a proposal to allow child-related tax deductions to be shifted between parents in cases of unequal income—favouring simplicity over flexibility. The Council of States, Switzerland’s upper house, had supported such transferability.
A final decision now rest with the Council of States, which is expected to discuss the plan in June, during the summer session. If adopted, individual taxation could become one of the most consequential shifts in Swiss tax policy in decades.
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SRF article (in German)
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