Couples will soon be taxed individually

Baptiste Wicht

Baptiste Wicht

The Poor Swiss
Staff member
Hi,

I should have written that a few weeks ago, but as you probably have seen, Swiss citizens accepted a change to switch to individual taxation. This will be effective sometimes before 2032 (normally).

Spouses will now be taxed separately instead of jointly. I do not believe we will have to fill out two tax declarations; this will hopefully be baked into the tax software, and it will impact the taxes we pay. But each canton will do as they choose.

On the one hand, I am thrilled about this change because it will eliminate one of the disadvantages of marriage in Switzerland. Being married or not should not impact taxes.

On the other hand, I am pissed about this change because we will pay even more taxes. We are in the category that will be impacted negatively since we have one large income and one small income. We already pay a ton in taxes (50% of our expenses), so I am not looking forward to paying even more.

What do you think about this change?
 
Baptiste Wicht said:
What do you think about this change?
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I also welcome this change. Yes, maybe it increases effort and complexity, meaning more employees in the tax offices. And yes, for some people it might also mean higher taxes. But I see this as a choice of principles. Each person should be taxed as individual, regardless of the current living situation.
Interestingly, we might have some further votes on this topic that could lead back to the current system. But I don't think this will happen.

Baptiste Wicht said:
We already pay a ton in taxes (50% of our expenses),
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Actually, that's a reason to congratulate you for high income and low expenses :p
 
Baptiste Wicht said:
I am wondering if this warrants a full article.
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Since I'm not married, I don't have a full grasp of all potential changes.
My thoughts, being on the skeptical side:
  • Many concret changes and actual implementations are not yet known. It might therefore be a bit early for an article
  • Most relevant changes (i.e. the ones with biggest impact) are done on cantonal and municipal level. Keeping track of all these developments would be quite a task and hard to put in to general, detailed and useful advice for most people.
 
gaijin said:
Since I'm not married, I don't have a full grasp of all potential changes.
My thoughts, being on the skeptical side:
  • Many concret changes and actual implementations are not yet known. It might therefore be a bit early for an article
  • Most relevant changes (i.e. the ones with biggest impact) are done on cantonal and municipal level. Keeping track of all these developments would be quite a task and hard to put in to general, detailed and useful advice for most people.
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Thanks for your feedback!

An article would indeed not entirely contain the cantonal changes at this point.
 
I do not agree on imposing one option.

First, as a concept, my view of a marriage is that „we are one“. If we leave on one household, the income should be per default the household, or marriage income, not „her“ income and „his“ income. It is (A+B), and divided /2 for tax rate per capita.

Second, i find imposing a separate taxation is abusive. I would conceed of giving an option „do you want to be taxed separately or together“, but I am totally against imposing a separated tax.

Bare in mind additionally, that couples make choices regarding child support and work-life balance, having often one of them (majority the times the mother) working a reduced part time % to be more time with the children. If this new rule negatively affects these couple decisions (i did not check all the implications tbh), or even both working part time like 80 -60, my oposition to it is even stronger.
 
Hugo Falcao said:
I do not agree on imposing one option.
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Arent' we already forced to use joint taxation now? It does not change the "forcing", only which system we are forced to.

If there was an option, people would simply choose the one that yields less taxes, so it would not really make sense.

For me, the choice is whether to get married or not. And this choice should not have any impact on the amount of taxes one household is going to pay.
 
Baptiste Wicht said:
Arent' we already forced to use joint taxation now? It does not change the "forcing", only which system we are forced to.

If there was an option, people would simply choose the one that yields less taxes, so it would not really make sense.

For me, the choice is whether to get married or not. And this choice should not have any impact on the amount of taxes one household is going to pay.
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Yes, but that is what makes sense on a marriage, as I see it. The family is earning one amount together.

Unless I am not fully understanding how the swiss taxes work in terms of tax rate. Please correct me If I am wrong. As my wife just recently started to work more that 20%, I may not be aware if something dramatically impacts the tax rates.

Example Couple Incomes: 80k + 120k = 200k, the tax rate to pay is the average ob both 100k, meaning annual household income divided by 2 members, since there are 2 persons living on a 200k income, maybe with a bit tweaking taking into account progressive tax rates. Am i wrong?

On the other hand, giving the people the option it would make sense for me. We could choose the most beneficial tax structure instead of being one that separates family household incomes in two tax declarations.
Baptiste Wicht said:
For me, the choice is whether to get married or not. And this choice should not have any impact on the amount of taxes one household is going to pay.
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Completely agree. That is for sure one thing that the must (should?) be out of the equation when 2 persons are deciding to take this step.



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EDIT:

Well, I think I did a few wrong assumptions on this matter. Should have done my research before. As far as I now understand, the actual system benefits couples where one of them works/earns much more than the other, and has a disadvantage where both work/earn the same because the earnings/assets are simply aggregated and do not take the rate of the average income that comes from 2 individuals (as i thought it would).

I read about the reasoning for and against the new system and both of them have some points I can agree on.

I wonder if in the future this could bring to less families having most of the income coming from one person (mostly the man) and could lead to more households where both work like 60-80%.
 
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Hugo Falcao said:
Example Couple Incomes: 80k + 120k = 200k, the tax rate to pay is the average ob both 100k, meaning annual household income divided by 2 members, since there are 2 persons living on a 200k income, maybe with a bit tweaking taking into account progressive tax rates. Am i wrong?
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That's indeed wrong. It's not averaging out with the old system, it's counting a single income of 200k. However, it's using a different tax rate than for an individual earning 200k.
Hugo Falcao said:
Well, I think I did a few wrong assumptions on this matter. Should have done my research before. As far as I now understand, the actual system benefits couples where one of them works/earns much more than the other, and has a disadvantage where both work/earn the same because the earnings/assets are simply aggregated and do not take the rate of the average income that comes from 2 individuals (as i thought it would).
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Exactly (y)
Hugo Falcao said:
I wonder if in the future this could bring to less families having most of the income coming from one person (mostly the man) and could lead to more households where both work like 60-80%.
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That was one of the arguments of the initiative, to increase the number of workers. But for that to work, you need more jobs and I am not convinced this will change anything.
 
it is a reform to guarantee tax fairness between all citizens and to stimulate participation in the labor market without distinction of marital status.

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