VAT rates will be reduced / Commuting costs deduction will be limited in Canton Zurich

VAT rates as of 1 January 2018

The Swiss voting population declined the bill to reform the pension system on 24 September 2017. The bill included a front end financing by means of the VAT. Due to the declination of this bill the financing from VAT contribution will not be implemented. That is why the VAT rates will be changed as follows as of 1 January 2018:

  • standard rate (new): 7.7% (current: 8.0%)
  • special rate for accommodation (new): 3.7% (current: 3.8%)
  • reduced rate (no change): 2.5%


Limitation of commuting costs deduction in Canton Zurich

As of 1 January 2016 the deduction of commuting costs were limited to CHF 3’000 per year for Federal taxes. The Canton of Zurich now followed suit and set the limit to CHF 5’000 per year which will be valid as of 1 January 2018. Currently commuting costs can be deducted without any limitations. According to the Zurich tax office, 85’000 tax payers will be affected by this change. The additional tax revenue will be used to finance the railroad infrastructure fund.

Posted on October 10, 2017 in Tax, Value Added Tax

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