Corporate Tax Reform III (CTR III)

Corporate Tax Reform III (USR III) aims to abolish the different taxation of domestic and foreign corporate profits by the cantons. However, the cantonal profit tax rates remain the competence of the individual cantons.

Regulations for Internationally Active Companies

Swiss corporate taxation has come under criticism abroad. With the goal of restoring international acceptance and maintaining legal and planning security for companies, the Federal Council, in cooperation with the cantons, has drafted the USR III (see Corporate Tax Reform III in the Consultation Process)

For internationally active companies, special rules apply today, with profits earned abroad being taxed at a reduced rate at the cantonal level. USR III aims to abolish this differential taxation of domestic and foreign corporate profits by the cantons. To compensate for the loss of competition due to these regulations, cantonal levels can tax licensing royalties at a reduced rate and grant increased tax deductions for research and development.

The cantonal profit tax rates remain under the competence of the individual cantons and are thus not part of the reform. Under Locations for a Domicile you will find an overview of our offered locations for a domicile with the respective cantonal tax rate for companies.

Current Status of USR III

In June 2015, the Federal Department of Finance presented the message to USR III for subsequent parliamentary consultations. In the winter session of 2015, the Council of States, as the first council, dealt with USR III and accepted it clearly in the final vote. As the second council, the National Council has further possibilities to adjust in order to increase the effectiveness of the reform. Depending on whether a referendum is launched or not, USR III is expected to come into effect at the beginning of 2017 or early 2018.