The Federal Council announced that during its meeting on 2 June 2017, it decided that the partial revision of the Value Added Tax Act adopted by Parliament would come into force on 1 January 2018. The revised Act will make a significant contribution to the removal of VAT-related competitive disadvantages for domestic companies. The mail-order regulations will come into force a year later.
A company’s global turnover will now be decisive for mandatory tax liability, and no longer just its turnover in Switzerland. Companies whose global turnover is at least CHF 100,000 will be liable to VAT from the first franc of turnover in Switzerland. Previously, foreign companies could provide their services in Switzerland without VAT up to a turnover level of CHF 100,000, which led to competitive disadvantages for Swiss businesses, especially in the border regions.
There will be a delay of a year for the mail-order regulations. These will not come into force until 1 January 2019, as Swiss Post needs more time for the implementation of the statutory provisions for technical reasons. Consequently, mail-order companies will be liable to tax from 2019 if their annual turnover from small consignments that are import-tax-free is at least CHF 100,000. Such mail-order companies will themselves bill customers for VAT. In return, the customers will no longer have to pay the taxes and fees levied by Customs upon importation. The VAT-related competitive disadvantages for domestic companies will be reduced as a result.
The remaining changes – reduced VAT rate for electronic newspapers, magazines and books, margin taxation for collectors’ items and others – will all enter into force on 1 January 2018.