The Swiss National Council is debating a tax reform centered around the taxation of married couples. Two opposing people's initiatives are at the heart of the matter: one advocating for joint taxation of married couples, and the other pushing for individual taxation regardless of marital status. The government proposes indirect counter-proposals favoring individual taxation for all.
The debate's complexity stems from the varying advantages and disadvantages each model presents, affecting different income groups. The reform involves not only married and cohabiting couples but also singles and retired couples. The differing models reflect underlying societal values and structures. For instance, the Mitte party emphasizes the importance of considering married couples as a unit.
Currently, Swiss law stipulates joint taxation for married couples. The term 'marriage penalty' is misleading as it doesn't automatically imply higher taxes. Tax implications vary based on couples' income levels. Traditionally, couples with one primary earner benefit from joint taxation, while those with similar incomes may pay more.
The favored solution involves transitioning to individual taxation for all, irrespective of marital status. To offset potential burdens, child deductions could be increased from CHF 6700 to CHF 10'700 or even CHF 12'000, split between partners. The tax rate structure is also planned to alter to benefit low and medium earners while potentially increasing tax burdens on high earners. Key points of contention include the exact amount of the child deduction, and how it is handled when one partner has little or no income.
The FDP supports individual taxation, a stance largely shared by the SP and Greens. However, the Mitte and SVP favor joint taxation for couples. The debate significantly revolves around the level of tax rates and deductions which will directly affect government revenue.
The National Council's decision is expected to be close, with neither side holding a clear majority. The final decision will hinge on securing the necessary votes on deduction amounts, a situation that will require compromises. Even if approved by Parliament, implementation is far from certain, requiring a referendum followed by substantial changes in cantonal tax laws. This process is likely to take several years.