Zurich Divided Over 'Fat Cat Tax' Initiative
13 May 2013
Posted by: Author: Ulrika Lomas
Source: Ulrika Lomas (Tax-News.com, Brussels)
Opponents of the Young Socialists' "fat cat tax" initiative have warned that the levy will not only affect a small group of multimillionaires, but will also penalize savers, pensioners, and businesses in the Swiss canton of Zurich, if adopted in the upcoming vote.
The Young Socialists have called for a wealth tax of 1 percent to be imposed on individuals with assets in excess of CHF2m (USD2.1m), to ensure a greater contribution from the canton’s wealthiest. The cantonal people’s initiative entitled "against tax gifts for the super-rich, for a strong canton Zurich," is due to be put to the cantonal vote on June 9.
Many fear the impact of such a measure on the canton, however. Rather than strengthening Zurich, opponents insist that the plans will lead to relocations by both businesses and individuals.
The Swiss People's Party SVP Zurich maintains that the initiative will have an adverse effect on many small- and medium-sized businesses in the Swiss canton, who have invested their assets in their companies. In order to pay the new tax, entrepreneurs may be forced to take money out of the firm, dramatically reducing their scope to invest in new products and to preserve or to create jobs, the party maintains.
SVP Zurich points out that good income earners already pay higher than average taxes in Zurich, noting that 1 percent of the population contributes a quarter of total income from individual income tax. The fat cat tax will merely destroy the balanced tax system, the party stresses.