Taxation of savings income

In order to tax the savings income of EU citizens living in Switzerland, the country operates a system of tax retention on savings income at progressive rates up to 35%. Three quarters of the receipts from this tax are paid out to EU countries. This withholding tax guarantees banking secrecy. Related companies with their principal base in Switzerland, as well as subsidiaries in EU member states, no longer pay withholding tax on payments of dividends, interest and licence fees. This increases Switzerland’s appeal as a business location.