International Tax Review is part of the Delinian Group, Delinian Limited, 8 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Switzerland: Switzerland’s proposed Corporate Tax Reform III – transfer pricing impacts



Hans Rudolf Habermacher

Anja Klein

The proposed abolishment of the Swiss holding, mixed and domiciliary company tax regimes within the next five to seven years and the planned introduction of replacement tax measures (for example, the licence box and notional interest deduction) known as the "Swiss Corporate Tax Reform III" has recently sparked some discussions regarding its impact on corporate taxation. It should not be forgotten, though, that this reform will also have significant impacts on transfer pricing arrangements: many MNEs conducting business in Switzerland operate under said tax regimes and from a transfer pricing perspective their abolishment may entail a revision of the underlying business model and transfer pricing set-up to ensure MNEs continue to benefit from favourable taxation levels in Switzerland. The proposed tax reform may require taxpayers to pay more attention to their transfer pricing arrangements. This, however, may provide valid opportunities for companies to optimise their intercompany structures in such a way that they make maximum use of the new structuring possibilities. If implemented, an IP box tax exemption may allow existing companies to significantly reduce the tax rate on royalty income received from foreign affiliated companies or alternatively, a separate licence box company could be created to benefit from such an exemption.

Similarly, the notional interest deduction on equity as currently suggested would be an effective way to reduce a holding company's or mixed company's taxable income in case of a strong equity base. Thus, the new tax reform will allow taxpayers to implement attractive structures through valid transfer pricing, if aligned to the transfer pricing guidelines, as alternatives to the existing preferential Swiss tax regimes.

Hans Rudolf Habermacher (

Tel: +41 58 279 6327
Anja Klein (

Tel: +41 58 279 7245


more across site & bottom lb ros

More from across our site

Industry groups are concerned about the shift away from the ALP towards formulary apportionment as part of a common consolidated corporate tax base across the EU.
The former tax official in Italy will take up her post in April.
With marked economic disruption matched by a frenetic rate of regulatory upheaval, ITR partnered with Asia’s leading legal minds to navigate the continent’s growing complexity.
Lawmakers seem more reticent than ever to make ambitious tax proposals since the disastrous ‘mini-budget’ last September, but the country needs serious change.
The panel, the only one dedicated to tax at the World Economic Forum, comprised government ministers and other officials.
Colombian Finance Minister José Antonio Ocampo announced preparations for a Latin American tax summit, while the potentially ‘dangerous’ Inflation Reduction Act has come under fire.
The OECD’s two-pillar solution may increase global tax revenue gains by more than $200 billion a year, but pillar one is the key to such gains due to its fundamental changes to taxing rights.
The solution to address the tax challenges arising from digitalisation and globalisation will generate more revenue than previously estimated.
The OECD has made headway in combating harmful tax practices as part of the BEPS project, according to peer reviews.
The Europe Middle East & Africa awards research cycle has now begun – don’t miss on this opportunity be recognised in 2023