Petrol, flight prices set to increase under Swiss environmental proposal

A proposal currently being debated in the Council of States would see potentially significant increases to flight, petrol prices and heating costs across Switzerland in a bid to combat CO2 emissions.

Petrol, flight prices set to increase under Swiss environmental proposal

In a debate that ran late into Monday night and continued into Tuesday, the Swiss upper house proposed a tax of between 30 and 120 francs per flight, while diesel and petrol could increase by up to ten cents a litre.

The CO2 rules on new cars, vans and trucks are also likely to be tightened, while a ban on oil heating has been forecast in buildings.

The goal is to halve greenhouse gas emissions by 2030, which advocates argue will bring Switzerland in line with its requirements under the Paris Climate Accords. 

While the proposal has majority support in the upper house, there have been notable critics – with the majority of Swiss cantons not supporting the new measures. Under the bill however, cantons who put in environmentally sound measures that have at least an equal impact on emissions reduction would be exempt from implementation. 

The proposal comes after the lower house of Swiss parliament voted to support an increase in flight taxes earlier. As reported by The Local earlier in September, those in support of the taxes criticised the “extremely cheap tickets sometimes on offer”, saying that people were “flying like there’s no tomorrow”. 

Although a similar proposal was defeated in the national council in 2018, the current set of changes appears more likely to succeed due to a “change in the political wind”. Roberto Zanetti (SP/SO), said that the representatives were heavily influenced by the climate strike protests. 

While initially considering the climate strikes to have little impact, Zanetti told Swiss parliament “I was wrong. They have influenced our thinking – and our consciousness”. 

Part of the money raised from the new taxes is set to go towards a new “climate fund”, which will be used to promote renewable fuels and electronic mobility. 

One third of the tax on oil products will go towards the climate fund, as will half of the money raised under the air ticket tax. The Federal Commission indicates that the remainder will be redistributed to citizens and the Swiss economy. 

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Why do companies in Switzerland have to pay church taxes?

Many of us who have moved to Switzerland are familiar with the concept of 'Church Tax'. While individuals can be required to pay it, what are the obligations for companies?

Why do companies in Switzerland have to pay church taxes?

Do companies need to pay Switzerland’s church tax?

Unfortunately, yes, companies are required to pay church tax most of the time and across most of Switzerland’s 26 cantons, as per Article Three of the Swiss Constitution.

There are very few exceptions.

If your company has an explicitly religious focus, it may be exempt from church tax.

Another exemption may apply if your company is a partnership. If the owner has left their church, as per the requirements for individuals, the company may no longer be liable.

Of course, this depends on cantonal tax laws, which can vary widely across Switzerland. That’s why it’s essential to understand your canton’s tax laws before setting up shop.

READ MORE: Do I have to pay ‘church tax’ in Switzerland?

How much is it?

Church tax is a proportion of cantonal taxes, representing approximately 23.5% of net profits. The exact distribution will vary from canton to canton – and year to year.

Are there cantons where companies are not liable for the church tax?

Some cantons don’t levy church tax on companies.

The good news is that companies based in Geneva, Basel-City, Aargau, Schaffhausen, and Appenzell-Ausserrhoden do not have to pay.

In two other cantons, Ticino and Neuchâtel, the payment of church tax is optional for companies.

Do sole traders and freelancers have to pay?

Not unless the owner, as an individual, has indicated membership in one of the recognised churches in their canton during the registration process—the Swiss Catholic Church, the Roman Catholic Church, the Evangelical Reformed Church, or the Jewish community.

If you’ve already done this, you can leave the church by following a simple procedure, depending on your canton of residence.

This involves sending a registered letter to your parish or synagogue expressing a desire to leave the church. You must send a registered letter stating the same to the cantonal tax office.

Of course, this procedure will vary, so you must determine the exact process for your canton, and remember that the Swiss are sticklers for detail.

Having done this, you will be considered as leaving the church on December 31st of that year, and not be liable for church taxes from that point onward. 

READ MORE: OPINION: Why so many Swiss are quitting the church and taking their money with them

How do the Swiss feel about this?

Despite a dramatic drop in the number of Swiss declaring membership in a church over the last five years – some estimates put it at approximately 5 percent – most of Switzerland’s cantons have yet to abolish church taxes on companies, and those referenda that are called on the matter do not succeed.

One reason could be—and so the churches argue—that scrapping the church tax on companies would substantially burden the state and, therefore, the average Swiss taxpayer.

The number of hospitals, aged care facilities, daycares, and schools run by churches—the Catholic church in particular—is cited. Substantive infrastructure costs could be incurred if these facilities were either closed down or taken over by the state.

That’s not to say that abolishing the church tax on companies is not a subject of frequent debate. As recently as this week, a right-of-centre FDP party member, Carlos Reinhard, introduced a motion in Bern’s cantonal parliament to make it voluntary for companies to pay the church tax.

Such a move would place in doubt the local Catholic church’s ability to fund the equivalent of approximately 38 million euros in works. Understandably, the church in the canton has been strenuously campaigning in favour of maintaining the status quo.