November 2021 / Switzerland

Switzerland is attractive to employers, as it has some of the most liberal labor legislation in the world.

The labor market is very flexible due to Switzerland’s liberal legislation, making it easy for companies to employ or dismiss staff at short notice in accordance with their financial requirements. The incidental wage costs are low compared with other countries and strikes have been far more infrequent in Switzerland than in any other European country over the last ten years.

Switzerland is also ideal for highly qualified employees, as the quality of life is very high and salaries are substantial. This also applies to skilled international workers and executives. Switzerland remains one of the most popular expat destinations, and frequently received top marks in various rankings. The attractive and moderate income tax rate for natural persons also plays a part in the attraction and is something that skilled foreign workers also benefit from.

You can down the publication prepared by S-GE on the Swiss Job Market here

Source: Switzerland - Global Enterprise

According to a press release of 1 November 2021, published by the Swiss Federal Social Insurance Office, the Switzerland - United Kingdom Social Security Coordination Agreement (2021) applies provisionally from 1 November 2021. The agreement will enter into force after all necessary domestic ratification procedures for the entry into force have been met in both contracting states. For more information on the provisional application, see article 73 of the Switzerland - United Kingdom Social Security Coordination Agreement (2021).

The new agreement coordinates the social security systems of the two states as the European Union - Switzerland Free Movement of Persons Agreement (1999) is no longer applicable in relations between Switzerland and the United Kingdom following Brexit.

The Federal Council has enacted the Federal Act on the Implementation of International Tax Agreements (ITAIA) and the associated Ordinance with effect from 1 January 2022 in order to align the existing legal framework with developments in international tax law.

Before, domestic legislation on certain issues regarding the implementation and application of tax treaties was governed by the Federal Act of 22 June 1951 on the Implementation of International Federal Conventions on the Avoidance of Double Taxation and the ordinances based thereon. The ITAIA supplements the existing legal provisions as necessary and introduces new areas of regulation. The revision of the law also stipulates how mutual agreement procedures are to be carried out at domestic level, provided the applicable agreement does not contain any deviating provisions. Moreover, it contains the key points for withholding tax relief based on international agreements, as well as criminal provisions in connection with relief from withholding taxes on investment income.

The entry into force of the ITAIA requires certain existing ordinances to be amended. Further, 2 ordinances and a federal decree will be repealed, as they will be superseded with the entry into force of the ITAIA. The Federal Council enacted the ITAIA in its meeting on 10 November 2021.