Changes in Switzerland from 1 January 2024 – VAT & Customs duties

Change in the Swiss VAT rates

Changes are coming to the Swiss VAT rates. From 2024, Switzerland has approved an increase in the Swiss VAT rates.

There are changes in both the normal rate and the reduced and special rates. The new rates apply from 1 January 2024.

• Standard rate changes to 8.1%, instead of the current 7.7%

• Reduced rate changes to 2.6%, instead of the current 2.5%

• Special rate changes to 3.8%, instead of the current 2.7% (overnight stay/accommodation)

It is already possible to report to the Federal tax administration (FTA) using the new rates from the VAT periods Q3 2023, 2. half year 2023 and the monthly reporting from July 2023.

Changing VAT rates sometimes creates challenges for correct reporting and handling, especially around credit notes for old periods (new vs. old rates) and VAT on the provision of services that extend over time.

Customs duties on industrial products

From 1 January 2024, the Swiss authorities will abolish import taxes / duties on industrial products. Changes are coming to meet the high prices in Switzerland and a customs deficit of CHF 500 million is expected.

These are products from the HS system chapter 25-97. Apart from a few individual exceptions in chapters 35 and 38, the customs duty will thus be 0%. The change will mean that compliance and import procedures for industrial products will be easier and much more timesaving for both companies and consumers when purchasing industrial products to be imported to Switzerland.

The legislative changes will also impact the Swiss customs code which will be reduced from 6172 positions to 4592 customs positions to simplify the classification of products.

The customs clearance process will therefore be less burdensome, as the tariffing will be simplified and proof of origin will not have to be used to obtain a duty reduction in Switzerland. However, there will still be a special need for preferential proof of origin in order to be able to document origin and at the same time import VAT, licenses and excise duties and the corresponding compliance will continue to apply even if there is no duty on a sold item.

Although we see here a de-bureaucratization and financial savings for companies selling industrial products, we expect, in continuation of announcements from the EU, that in the near future “Green taxes” will be imposed, which will be taxes based on sustainability and environmental aspects.