Swiss Parliament Divided Over Hotel VAT Rate Extension

The Swiss Parliament is debating whether to extend a lower VAT rate for hotels until 2035. The reduced tax rate, currently set at 3.8%, was introduced in 1996 and has been extended several times since then.

The National Council wants to abolish the special tax rate, while the Council of States wants to maintain it. The Council of States argued that keeping the lower VAT rate would support the hotel industry, which has been affected by a shortage of skilled workers and the strong Swiss franc.

The total amount involved is 310 million Swiss francs per year. If the National Council stands by its decision, the special tax rate for the hotel industry will expire at the end of 2027. The bill will now go back to the National Council.