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Large Swiss companies will pay a minimum tax rate of 15% from 2024 under the OECD agreement

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ZURICH – Switzerland will apply from 2024 the minimum tax rate for large multinational companies agreed last year by OECD and G20 member states, the finance ministry said on Thursday.

A temporary ordinance will ensure that the minimum tax rate of 15% for companies with turnover above 750 million euros ($ 860 million) goes into effect on January 1, 2024, the minister said. Finances Ueli Maurer, adding that a law would subsequently be enacted to amend the constitution.

He said around 200 Swiss companies and around 2,000 Swiss subsidiaries of foreign groups would be affected by the ruling, which he said provides legal certainty and ensures that tax revenues stay in Switzerland.

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“If 15% are to be collected, then we want to collect it in Switzerland,” he told a press conference in Bern, adding that the final details were still being worked out with the Organization of Economic Cooperation and Development (OECD) for the world’s largest business.

Maurer said it was too early to estimate how much additional tax revenue the Swiss cantons would receive under the program, or to say what sweeteners could be offered to ensure the traditionally low-tax country remains an international hub. for business.

A group of 137 countries in October set the global minimum tax rate of 15% for large businesses and sought to make it harder for them to avoid tax in a landmark deal.

Switzerland had been in the international crosshairs for years because cantons had special tax status for foreign companies, which meant that some paid virtually no tax compared to an effective federal tax of 7.8%.

But voters in 2019 approved a reshuffle of the corporate tax system, avoiding what Maurer had called an existential threat to the country’s role as a business hub.

A new constitutional amendment would also be subject to a referendum, but the temporary ordinance would allow Switzerland to join the new global regime in the meantime.

($ 1 = 0.8721 euros) (Report by Silke Koltrowitz, edited by Michael Shields)