Do you think that the tax burden is too high in the cantons of Geneva and Vaud?
A few days ago, we published a survey on Linkedin on the level of the tax burden in the cantons of Geneva and Vaud:
The results of this survey speak for themselves: residents of these two French-speaking cantons believe they pay far too much tax.
It is true that in intercantonal comparison, Geneva and Vaud are distinguished by a fairly strong progressiveness of marginal income rates and it is these same cantons which stand out with the highest wealth tax rate in Switzerland 1% and respectively 0.8%.
1. The canton of Vaud realizes this since it is currently looking into 4 tax reductions starting from the 1ster january 2022 which will concern low-income taxpayers, families, SME owners and even professional pensions:
There first modification concerns the deduction for low-income single people which will be increased to 16,000 francs, for net income not exceeding 16,099 francs.
There second is intended for families to try to improve the match between family and professional life, the deduction for actual childcare costs is increased by 1,000 francs to reach a maximum of 10,100 francs, currently 9,100 francs, for each child under 14 looked after by a third party.
The third section is aimed at SME owners: the authorities intend to adapt, within the framework of wealth tax, the valuation of securities not listed on the stock exchange while considering them as a "working tool" for the entrepreneur.
Finally, welfare (2nd pillar and 3rd pillar A): in consideration of a growing awareness among the working population of planning for retirement, the authorities wish to encourage this effort by means of taxing incentive occupational pensions. However, the canton of Vaud is so far significantly behind compared to other neighboring cantons and the project plans to reduce this tax by a third to a fifth. For example, the tax which amounted to approximately 14% in Lausanne will decrease to approximately 9% for 2022, i.e. a saving of 50,000 francs for an amount of 1,000,000 francs in pension. If you intended to receive your 3A or your free passage by the end of this year, perhaps it would be in your best interest, if possible, to wait a few more days?
2. For all cantons, other avenues for optimization:
Let's return to our survey and shed light on the tools to deal with this high tax burden which are not lacking. We will think about the means that we mentioned in our newsletter for May 2021 which you will find here https://impact-fe.ch/2021/05/31/la-suisse-un-paradis-fiscal
which mentions real estate, debt, dividends and latent reserves for shareholders, the return on asset management, the tax shield and finally insurance solutions as avenues for optimization.
It's never too early, but sometimes it can be too late!
