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CANTONS

Analysis: Which Swiss cantons have the fewest Covid-19 infections — and why?

As the number of reported coronavirus infections is rising in Switzerland, it is easy to forget that some cantons have had relatively few cases.

Analysis: Which Swiss cantons have the fewest Covid-19 infections — and why?
Some Swiss cantons have few coronavirus infections. Photo by AFP

On September 11th, Switzerland recorded 528 Covid-19 cases, the highest number since mid-April. 

However, most of the infections are concentrated in three ‘hotspots’— Geneva, Vaud, and Zurich.

According to the Federal Office of Public Health (FOPH), until September 13th Vaud has registered 8,771 cases, followed by Geneva with 7,618, and Zurich (6,882). 

“These are urban areas. The population density is higher there than in the countryside”, Swiss Health Minister Alain Berset said in interview with TagesAnzeiger newspaper on Sunday. 

“Also, there is an above-average number of jobs in these regions and therefore high levels of travel. This leads to a higher number of contacts, which favour the spread of the virus”, he added.

But statistics show that the situation is much less dire away from large cities.

For instance, in each of the small cantons of Uri, Obwalden, Nidwalden, Glarus, Shaffhausen, Appenzell Inner- and Ausserrhoden, as well as Aargau, there has been less than 180 reported cases since the beginning of the pandemic in mid-March.

Except Aargau and Shaffhausen in northern Switzerland, the other cantons are located in the central part of the country, away from urban centres.

READ MORE: Swiss health chiefs insist there's no cause for alarm as Covid-19 cases surge

It’s true that they are smaller and  less populated than the ‘hotspots’, but their geographical location away from clusters of big cities likely has an impact on the low number of cases.

For instance, Schwyz and Zug are also relatively small, centrally located cantons, but they have respectively reported 461 and 375 infections, which might be attributed to their proximity to Zurich.

Who is most affected by the coronavirus?

While at the beginning of the health crisis, Covid-19 hit predominantly the elderly and those with chronic medical conditions, FOPH’s figures indicate that this demographic has changed.

Of the nearly 47,000 people infected with the coronavirus in Switzerland to date, the biggest group — 8,728 — is that of 20 to 29-year-olds.

Next are the 8,266 people between 50 and 59, followed by the 30 to 39 group (7,332), and 40 to 49 (7,100).

Interestingly, 3,017 children and teens up to 19 years have also been tested positive.

All the official FOPH numbers relating to Covid-19 can be found here. 

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TAX HAVEN

Why Switzerland is no longer the tax haven it used to be

In financial circles, the mere mention of ‘Switzerland’ has become synonymous with ‘tax haven’, a reputation the country has long denied. Is this still the case?

Why Switzerland is no longer the tax haven it used to be
It's not as easy for rich people to skimp on taxes. Photo by Fabrice Coffrini/AFP

For decades, Switzerland has been known as a destination for ‘fiscal tourism’. 

Fiscal tourism refers to wealthy individuals or foreign corporations that set up their residence in Switzerland to save money on taxes.

Some cantons had long attempted to lure these well-heeled entities.

READ MORE: Why Switzerland is no longer on the EU’s black list of tax havens

Authorities in the canton of Schwyz, for example, encourage newcomers to come to their canton because it “has one of the lowest tax burdens in Switzerland. Its fiscal policy…makes it an attractive location for both legal entities and individuals”. 

Other low tax rate cantons are Obwalden, Zug, Uri, Appenzell Innerrhoden and Nidwalden. The highest income tax rate in one of these cantons is around 17 percent, compared to about 30 percent in Vaud, Bern, Geneva and Zurich.

However, the practice of fiscal tourism is becoming a thing of the past, according to a report by Swiss public broadcaster RTS.

It based its findings on an analysis by the University of Basel, which shows that the days of cantons and communes competing to attract wealthy taxpayers may be over.

READ MORE: Tax rules cross-border workers in Switzerland need to know

For the first time in decades, the tax on high incomes has increased by 4 percent.

Schwyz too “had to raise its level of taxation after years of deficit accounts”, RTS said.

Another reason why Switzerland is becoming less appealing to rich taxpayers is because, due to tighter controls, it is not as easy as before for wealthy people to register as residents in a municipality with low tax rates, but live elsewhere.

In the past it was common for the wealthy individuals to set up an official address in low-tax canton or municipality, but reside somewhere else.

But is Switzerland still considered a tax haven?

In 2017, the country was placed on the EU’s list of tax havens  because “it intentionally attracted foreign investors by allowing corporations and wealthy individuals to pay a low, lump-sum tax on the money they kept in Swiss banks”.

However, Switzerland was removed from the list in 2019 because that year Swiss voters accepted a legislation which introduced major changes in the Swiss tax system by ending some preferential tax schemes and replacing them with new regulations which are in line with international standards.

READ MORE: Reader question: Can I deduct working-from-home costs from my Swiss taxes?

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