Swiss voters approve global minimum tax on businesses - and a new climate law

Voters in Switzerland on Sunday approved the introduction of a global minimum tax on businesses and a climate law that aims to cut fossil fuel use and reach zero emissions by 2050, public broadcaster SRF reported.

The results showed almost 80% of those who voted in Sunday's national referendum backed raising the country's business tax to the 15% global minimum rate from the current average minimum of 11%, an unusually strong endorsement.

"This ensures that Switzerland will not lose any tax revenue to foreign countries," Finance Minister Karin Keller-Sutter said. "It will on top also create legal certainty and a stable framework."

The climate law was likewise approved and received the support of 59% of voters.

In 2021, Switzerland joined almost 140 countries that signed up to an Organisation for Economic Cooperation and Development (OECD) deal to set a minimum tax rate for big companies, a move aimed at limiting the practice of shifting profits to low tax countries.

Even with the increase, Switzerland will still have one of the lowest corporate tax levels in the world, and the proposal, estimated to bring 2.5 billion Swiss francs ($2.80 billion) per year in additional revenue, has been backed by business groups, most political parties, and the public.

The climate law, brought back in a modified form after it was rejected in 2021 as too costly, has stirred up more debate with those campaigning against it gaining traction in recent weeks.

Proponents say the law is the minimum the wealthy country needs to do to prove its commitment to fighting climate change while opponents from the right wing People's Party say it will jeopardise energy security.

In Sunday's referendum, voters also approved extending some provisions of the country's emergency COVID-19 law, required under Switzerland's system of direct democracy, where legislation is put to the public vote.

Switzerland is home to the offices and headquarters of around 2,000 foreign companies, including Google (GOOGL.O) as well as 200 Swiss multinationals, such as Nestle (NESN.S). While all would be affected, business groups have welcomed the greater certainty that the new tax would bring, even if Switzerland lost some of its low-tax allure.

"No other country is going to have lower taxes either. We want the additional tax revenue to stay in the country, and be used to improve its attractiveness for businesses," said Christian Frey, from Economiesuisse, a lobby group.