Suisse
Trade tax revenue drops for public deficit forecasts 2025
The deficit scheduled for 2025 goes from 800 to 200 million francs thanks to tax revenue from trading. But Bern remains cautious in the face of the foreseeable decline in VAT revenue, due to the slowdown in growth.
Siege from Glencore to Baar, in the canton of Zug.
@Glencore
Switzerland has strongly revised its deficit forecast for 2025 thanks to the tax revenue generated by the trading of raw materials, even if it is cautious for VAT in the face of the slowdown in economic growth.
For 2025, the country divided by four its forecasting budget deficit to bring it back to 200 million Swiss francs (212 million euros), against 800 million francs of deficit previously expected, according to a press release from the Federal Council and the Federal Finance Administration.
Forecasts for tax revenue “exceeded expectations in 2024” and were enhanced for 2025, following “additional revenue for the 2022 and 2023 tax years from the Canton of Geneva and, more specifically, energy and raw materials trading companies”, according to this press release. They “strongly” contributed to the increase in the profit tax product, with “around 900 million” expected for 2025, quantifies the press release.
Raw materials
Switzerland is home to many trading companies, many of which are based in Geneva Like in particular Vitol or Trafigura, which is based in Singapore, but has an important activity center in Geneva. Others are based in the canton of Zug, in the center of Switzerland, in particular like Glencore.
“This development being due to the increase in prices of raw materials, it constitutes a temporary phenomenon,” said the press release, however. The courses of many raw materials had gone in 2022 following the invasion of Ukraine by Russia, but then had reflected with episodes of strong volatility which tend to swell transactions at the level of trading companies.
VAT recipes
The Government and the Federal Finance Administration, on the other hand, expect the product of the value added tax (VAT) to prove to be “200 million lower than the budget”, details the press release while the growth prospects deteriorate. In mid-June, the Ministry of the Economy had lowered its growth forecasts to 1.3% for 2025 (compared to 1.4% before) and to 1.2% for 2026 (against 1.6% previously) in view of the climate of persistent uncertainty that weighs on the global economy.
From, Switzerland was struck by the customs duties imposed by the White Housewhich noted them at 39%, against 31% initially planned. “For the time being, it is difficult to predict how Swiss companies will react,” notes the press release, which explains that “American customs duties will affect finances with a gap”, even if they should not yet have “significant consequences” in 2025.
AFP
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