New tax proposal could be a “nuclear bomb” for the super-rich, experts say
The youth wing of one of Switzerland’s political parties has proposed new taxes for the very wealthy, and finance experts warn of dangerous consequences.
The youth arm of one of the main political parties in Switzerland is proposing a new tax on the very rich, and finance experts warn the measure could be “extremely dangerous” for the country.
The Young Socialists or JUSOs, a part of the country’s Social Democrats party, is pushing for taxes to be imposed on inheritances and gifts valued at more than 50 million Swiss francs, or more than $59 million.
The JUSOs had gathered enough signatures to bring the matter to a national referendum, with the vote likely to be held within two years.
JUSO president Mirjam Hostetmann believes the ballot will occur by late 2026, per Reuters.
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New tax proposal could be a “nuclear bomb” for the super-rich, experts say
The Swiss government opposes the measure, while financial experts explain it could have catastrophic effects on the country.
“This initiative, we feel for the country, is extremely dangerous on its potential consequences,” according to Frederic Rochat, managing partner of private bank Lombard Odier.
Rochat says the fact that the proposal is being discussed and that it could take place in 2026 could cause two years of uncertainty. He said talking about the plan has made caused some of their clients to wonder if they should bring their business out of Switzerland, Reuters reports.
“This initiative is literally a nuclear bomb,” he said, and he said the big risk is that it would cause owners of smaller and medium-sized businesses to leave the country.
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Do the rich in the United States pay their fair share of taxes?
According to Oxfam, a global organization focused on ending poverty, says billionaires in the U.S. pay “a smaller tax rate than most teachers and retail workers.”
The agency cited a 2021 White House study that showed the richest 400 billionaire families in the country paid an average federal individual tax rate of only 8.2%.
This is considerably lower compared to the average American worker who paid 13% in taxes for the same period.