March 2022 / Switzerland

The Greater Zurich Area attracted 125 new companies to its nine cantons in 2021. They are planning to create more than 1,800 new jobs in sectors such as life sciences and ICT. The comeback of the USA is most impressive.

The number of companies being established is on the rise again following the coronavirus-related decline. As the investment promotion agency of nine cantons, the Greater Zurich Area AG (GZA) helped 125 companies establish themselves in 2021, an increase of 36 on 2020, the first year of the coronavirus crisis. According to a press release from the GZA, 42 of these companies were from the USA (+20), 19 from Germany (+4), ten from Italy (+5) and five each from China (-6), the United Kingdom and Singapore.

The newly established companies already created 582 new jobs in the reporting year, 11 percent more than in the previous year. They are planning to create 1,843 new jobs over the next five years.

The frontrunners are information and communication technologies, with 42 companies, followed by 25 life sciences companies, 18 engineering companies and 13 financial services companies. The most important “job creators” were the life sciences companies, with 235 new jobs, followed by ICT companies with 154.

However, the benefit these companies bring to the region goes far beyond jobs. “We specifically target those companies that can achieve high added value and strengthen the existing ecosystem," explained Sonja Wollkopf Walt, the GZA’s Managing Director, at a digital press conference.

The new companies include Benchling, for example. The U.S. provider of life sciences cloud solutions intends to create up to 150 jobs in the Circle at Zurich Airport. The Chinese pharma company Hengrui already has European headquarters in Basel and is now adding a research and development site in Zurich.

The German RegTech company targens will be marketing its compliance software solutions to banks in Switzerland and Liechtenstein from Schwanden in the canton of Glarus. Ruedi Becker, Chief Business Development at targens Suisse SA, was supported by GZA in convincing his managers of the benefits of Glarus.

This pleases Christian Zehnder, Director Economic Promotion for Glarus. Glarus has tended to be strong in manufacturing and food production. “We want to move away from our traditional image,” he said. “In attracting new companies, we rely on our partner GZA, which can promote the region on an international level.”

Sonja Wollkopf Walt takes a similar view: The arrival of targens strengthens the ecosystem as a whole and demonstrates that the region extends beyond Zurich and Zug. “Every company can find the perfect location for them in the Greater Zurich Area.”

The Greater Zurich Area includes the cantons of Glarus, Graubünden, Schaffhausen, Schwyz, Solothurn, Ticino, Uri, Zug and Zurich.

The Swiss Federal Council has launched a consultation on a constitutional amendment to implement the OECD Corporate Minimum Tax. The proposal contains a general provision on the amendment of the Swiss Federal Constitution and a temporary arrangement that will ensure that the minimum tax rate comes into force on 1 January 2024. Said temporary arrangement will be replaced by a bill released by the parliament. The core provisions to ensure the minimum tax rate of 15% for multinational companies with a turnover of more than EUR 750 million contain:

• a new article 129a of the Swiss Constitution that empowers the Confederation to release particular regulations on the taxation of multinational companies, including deviations from:
  • the principles of universality and uniformity of taxation and taxation based on the economic performance;
  • the maximum tax rates defined in article 128(1) of the Swiss Constitution;
  • the general execution rules and the share of the cantons in the collection of federal direct taxes; and
  • the obligation to harmonize tax laws on cantonal and federal level; and
• a transitory provision for article 129a, which contains principles of a supplementary tax for multinational companies, including:
  • a definition of a multinational company;
  • a definition of the minimum tax;
  • the method of calculating of profits subject to minimum tax;
  • the method of calculating the supplementary tax; and
  • the competent canton to assess the supplementary tax.

The Federal Council launched the consultation on 11 March 2022. The cantons and interested parties are invited to submit their feedback on the proposal by 20 April 2022. The change of the Constitution requires a people's referendum, and such referendum will take place in June 2023 at the latest.

On 18 March 2022, the Swiss Parliament approved the new Italy - Switzerland Tax Agreement (Frontier Workers) (2020), signed on 23 December 2020, under the Italy - Switzerland Income and Capital Tax Treaty (1976), as amended by the 1978 and 2015 protocols. Once in force and effective, the new agreement will replace the agreement on taxation of frontier workers between Italy and Switzerland, signed on 3 October 1974. Further developments will be reported as they occur.