Swiss Tonnage Tax

Government Consultation

April 2021 / STSA's position paper:
- Original version (German)
- English translation
- French translation

Switzerland, a maritime nation

A recent study run by Oxford Economics requested by the STSA outlines the importance of this economic sector in Switzerland. This study also unveils the positive impact that the introduction of a tonnage tax would have for the country’s competitiveness and attractiveness for businesses.Switzerland currently represents:- The 11th commercial operated fleet in the world from a volume stand point (GT). Comparable to the fleet operated from the UK, or Norway (Switzerland ranks number 5 among the EU countries).

The Shipping sector contributes yearly to the Swiss GDP with CHF 2.4 billion (approx. 0.4% of total GDP). It represents approximatively 2000 direct jobs.

An opportunity for the shipping industry in Switzerland

The introduction of a tonnage tax in Switzerland would strengthen the Swiss shipping sector. Job creations can be expected. Furthermore, this would contribute to aligning Switzerland with international standards. It would allow for Switzerland to be aligned with international standards. It would also boots the country's economy and reinforce its attractiveness.

If a tonnage tax is introduced in Switzerland, the following could be expected as of 2027:

This high potential represents an important factor, just like the competition of other countries getting stronger in this field: The UK through the Brexit, France recently granting incentives and also Luxembourg, where the introduction of a tonnage tax is being discussed. This illustrates the need for Switzerland to boost its attractiveness for this largely unknown sector.

The introduction of a tonnage tax would send a strong signal that Switzerland is taking measures to enhance its ability to compete.

Tonnage tax is a tax on profits that can be applied to shipping companies including ship management companies. The tax is calculated based on the Net tonnage of the ships incorporated into the fleet of vessels operated or managed by a company. It is therefore independent from the volume of material transported and the operating profit of a shipping company. Taxation through this means is therefore independent of the volume of material transported and the operating profit of a shipping company.

In the form currently debated, ecological criteria will also be considered. This will encourage investments into modern and safer fleets, that are also more respectful of the environment.

The tonnage tax's several advantages are :

- A simplified management of taxation, for both the tax authority and the companies in the sector. This method of taxation is based on an objectively measurable variable - net tonnage - by independent certifying bodies that determine the transport capacity of the vessels.

- A greater stability and predictability of the level of tax revenues for the cantonal and federal government. A company that decides to adopt the tonnage tax as a taxation method is linked to apply this method for a period of 10 years (lock-in).

The adoption of tonnage tax by a shipping company is not compulsory but optional. Once available, this method of taxation can or cannot be adopted by a given company..

The Swiss Trading & Shipping Association is a non-profit, non-political Swiss association representing companies active in commodity trading and shipping activities, trade finance and related services.

Rue de Chantepoulet 11
P.O. Box 1565
CH-1201 Geneva

+41 22 715 29 90