Politics · Switzerland · 7 hrs ago
Swiss committee proposes army fund without raising VAT
A National Council finance committee rejected a VAT increase to pay for more Swiss army and security spending.
It instead backed an 18-year fund worth 24 billion francs.
The fund would receive about 1.3 billion francs a year, including money from existing VAT revenue, unused budget credits and federal savings.
Another 400 million francs a year would come from reducing the share of federal income tax paid to cantons.
Critics say the plan burdens cantons and could challenge Switzerland’s debt brake because the fund could borrow up to 9 billion francs.
The National Council is due to decide in December; the Council of States and the Federal Council have both proposed raising VAT, but at different rates.
A Swiss National Council finance committee has proposed a 24 billion-franc security and defence fund without increasing value-added tax.
The fund would run for 18 years and receive about 1.3 billion francs annually from several sources.
The committee approved the financing model by 15 votes to 8, with one abstention.
The committee rejected a proposal to raise the federal VAT rate, unlike the Council of States and the Federal Council.
A minority said the plan would burden cantons and could call the debt brake into question.
- Who
- The National Council's Finance Committee proposed the fund.
- What
- It proposed an 18-year, 24 billion-franc security and defence fund without raising VAT.
- When
- The committee approved its financing model before the National Council is due to decide in December.
- Where
- Switzerland.
- Why
- The committee considers additional investment in the army and security necessary.
Committee majority
Committee minority
VAT increase
Committee majority
The majority opposes raising VAT to finance the fund.
Committee minority
The minority wanted additional revenue.
Funding burden
Committee majority
The majority's plan includes reducing the cantons' share of direct federal tax revenue.
Committee minority
The minority objects to placing a financial burden on the cantons.
Debt
Committee majority
The majority approved a fund that could borrow up to 9 billion francs.
Committee minority
The minority says this could call the debt brake into question.
The Council of States approved a compromise that included a temporary 0.2-percentage-point increase in the standard VAT rate.
The National Council Finance Committee announced its financing proposal.
The National Council is due to decide on the proposal.
- Fund duration
- 18 years
- Fund volume
- 24 billion francs
- Annual fund contribution
- About 1.3 billion francs
- Committee vote
- 15 to 8, with one abstention
- Potential borrowing
- Up to 9 billion francs
What people are saying
A concrete and financially sustainable alternative for financing armament spending