Multinational companies with offices in the region have reminded politicians that more than half the positions they create are filled by Swiss citizens, newspaper La Tribune de Geneve reports.
"Why spit in the soup when the soup was rather nice and has served the public authorities well?", said Blaise Matthey, head of the Fédération des Entreprises Romandes (FER), which represents businesses in the French-speaking part of Switzerland.
On September 29th, the Socialist Party of Geneva (PSG) launched a double tax initiative to remove fiscal deals enabling foreign citizens to pay a fixed amount in taxes every year, regardless of their real income or wealth.
The PSG is also asking for the abolition of the tax relief enjoyed by foreign corporations in the canton. The current system sees Swiss firms pay an average of 24.3 percent of their revenue in taxes, whereas foreign ones contribute an average of just 11.6 percent. “This is unfair competition for our economy,” the party said.
The head of the Finance and Housing Department, socialist Sandrine Salerno, also added fuel to the fire. In a column written for the municipal magazine Living in Geneva, Salerno pointed out:
“These firms come to Switzerland to pay less taxes, but also to avoid being subject to European regulations that are more drastic than ours. As a result, Geneva is growing and contributing to a weakening of the global economy.
“Good job,” she added sarcastically.
In a reply to Salerno, Procter & Gamble's director general Frédérique Reeb-Landry told La Tribune de Geneve that half the jobs the company creates every year are taken by Swiss citizens. That figure rises to an average of 60 percent across foreign firms, according to FER.
However, attracting global firms en masse has had consequences that go beyond tax cuts. Geneva has been at an infrastructural standstill for years, suffering especially from a severe housing shortage. The vacancy rate in September was just 0.25 percent.
A month before the federal elections, some political parties pointed the finger at highly paid foreigners who benefit from attractive tax rates and who have helped to push up property prices in the region.
Others disagree. The head of the Geneva Chamber of Commerce, François Naef,
told news agency AFP it is “ridiculous” to think that these qualified workers from abroad were at the root of the canton's woes.
According to Naef, the housing shortage was due to a lack of political will, or "overly strict legislation which has blocked construction over the last few years."
Multinationals with their European headquarters in Geneva include Procter & Gamble, Hewlett-Packard, Merck Serono and Caterpillar.