Swiss vote on multinational tax perks in February referendum

US medical implant maker Zimmer Biomet's decision on a potential $40 million investment in its Swiss factory has been put on hold until the outcome of a referendum next month on tax reform. A long-standing tax break that has attracted thousands of companies to Switzerland is set to go and the issue for Zimmer and some 24,000 international firms is how the new regime will stack up against other low-tax jurisdictions. That's not immediately clear as Switzerland's 26 regions, or cantons, set their business taxes. Consultants KPMG reckon the average Swiss corporate rate will be about 14 per cent after the reform, above Ireland's 12.5 per cent, but lower in some cantons. Switzerland has been in the European Union's firing line for years because cantons have a special tax status for foreign companies that means some pay virtually no tax over an effective federal tax of 7.8 per cent. The country agreed with Brussels in 2014 to abolish this status as it allows some foreign firms to pay far lower tax on overseas earnings, an attractive perk for multinationals looking to lower tax bills. Most Swiss recognise that the country needs tax reform to avoid being blacklisted as a low-tax pariah,...

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