Swiss want Plan B for tax reform by mid-2017

The Swiss government told the finance ministry on Wednesday to come up with a Plan B by mid-year for eliminating ultra-low tax rates for multinationals after voters rejected the original proposal, setting up a clash with other rich countries, reports Reuters.

The Swiss had promised to meet international standards and end by 2019 special low tax rates that benefit about 24,000 companies, a deadline that Finance Minister Ueli Maurer has said was dashed by this month's referendum.

The cabinet instructed his ministry to "draw up the substantive parameters for a new tax proposal by mid-2017 at the latest", a quick pace welcomed by the main Swiss business lobby.

The ministry will consult representatives of political parties, cantons, municipalities, business and labour in crafting a new plan, which the full government will use to craft new legislation that must get through parliament and probably voters under the Swiss system of direct democracy.

Most Swiss recognise the country needs reform to avoid being blacklisted as a low-tax pariah, but measures proposed to help companies offset the loss of their special status breaks had created deep divisions that led to the package's defeat.

The European Commission, which is in the process of drawing up a blacklist of uncooperative tax regimes, has said it was "very disappointed" with the Swiss referendum outcome.

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