PLEASE NOTE: THIS ARTICLE WAS ORIGINALLY SUBMITTED BY REVISUISSE PRICE WATERHOUSE, SWITZERLAND
The revised Zug tax law will enter into force on January 1, 2001. Not many details are known yet. We will keep you informed about any more important changes.
At present, the following changes are being discussed:
Individual Taxes
Change of the assessment basis: Today the income tax is calculated on the basis of the average income of the previous two years. Under the revised law the tax will be calculated on the basis of the current year's income.
Reduction of the wealth tax rate.
Abolition of the estate and gift tax. Since the federal level does not levy any estate or gift tax, no estate and gift tax would have to paid at all if the testator or donor is resident in the canton of Zug.
Corporate Taxes
A flat profit tax rate of 7% shall be introduced. Reduction of the capital tax rate (Today between 0.5 and 1,5 per mil).
Possibly, the present participation relief will be extended to equal the revised participation relief available on the federal level since January 1, 1998. This would mainly mean that capital gains on the sale of investments would be income tax exempt. For further information on the revised federal participation relief see our November 1997 article.
The content of this article is intended to provide a general guideline to the subject matter. Specialist advice should be sought about your specific circumstances.