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DRIVING

What costs do drivers face in Switzerland and where might you pay more?

From parking fees to motor vehicle taxes, owning a car in Switzerland can be quite expensive. These are some of the charges you should budget for.

What costs do drivers face in Switzerland and where might you pay more?
Parking, and other car-related costs, can be expensive. Image by Florian Pircher from Pixabay

To be far, all countries have more or less stringent rules pertaining to car ownership; Switzerland is not exceptional in this sense.

Still, if you live here, it is helpful to know what various car-related costs are, and where are they the highest / lowest.

Here’s an overview.

Parking

Switzerland’s Watson news outlet analysed recent data from the Price Surveillance Office pertaining to hourly rates at municipal parking metres in various Swiss cities.

It turns out that Zurich, Lucerne, and Lausanne have the most expensive tariff — up to 3 francs — for under one hour of parking.

Bern and Biel follow at 2.2 francs, but here is a surprise: in Geneva, which, along with Zurich, is the most expensive city in Switzerland and among the priciest in the world, a parking fee for less than an hour amounts to only 1.4 francs.

Now, if you park for more than two hours, Zurich is the most expensive city, at 7.5 francs, followed by Basel and Lucerne — 6 francs in each. Oddly enough, in Lausanne, the fee for the two-hour parking is almost the same as  its rate for less than one hour: 3 francs.

These Swiss cities make the most from parking fees. 

1.     Zurich: 21,4 million

2.     Lausanne: 13,7 million

3.     Geneva: 9 million

4.     Biel: 7,2 million

5.     Fribourg: 4,2 million

6.     Bern: 3,8 million

7.     St.Gallen : 3,2 million

8.     Yverdon: 3 million

9.     Basel: 2,5 million

10.  Schaffhausen: 2,3 million

On the bright side, while paying for a parking spot is never fun, keep in mind that all the money that municipalities “earn” in this way is used for public benefit in one way or another.

Registration

To drive on Swiss roads you must have your car registered. 

In addition to the permission to drive – an important component to owning a car – your registration will get you a set of licence plates, a registration certificate and you may need to have your car inspected to see if it is roadworthy. 

As with pretty much everything on this list, the cost of registering your car will depend on the canton, but it will be between CHF50 and CHF100 in most cases. If you do need to have your car inspected, that will cost roughly an additional CHF50. 

What about the motor vehicles tax?

Anyone who owns a vehicle in Switzerland must pay this tax, used to finance the maintenance of the road infrastructure.

The amount you must pay depends on where you live and what kind of car you drive, but basically it takes into account the capacity of the vehicle, its horsepower and weight, carbon dioxide emissions (CO2), or the combination thereof.

According to consumer website Comparis, cantons of Aargau, Fribourg, Glarus, Graubünden, Lucerne, Nidwalden, Obwalden, Schaffhausen, Solothurn, Thurgau, Valais, and Zug base their tax on the car’s cubic capacity and horsepower.

Appenzell Innerroden, Appenzell Ausserrhoden, Bern, Basel-Country Jura, St. Gallen, and Uri determine the tax based on the vehicle’s weight, while Schwyz, Ticino and Vaud use both horsepower and gross vehicle weight.

In Zurich, cubic capacity and vehicle weight determine the tax, in Geneva it is based on horsepower, in Basel-City on unladen (rather than gross) weight and CO2 emissions, and in Neuchâtel only on CO2 emissions.

Your tax will be lower if you drive a car considered to be environmentally-friendly, for instance a hybrid or electrical vehicle. However, Aargau, Appenzell Ausserrhoden, Lucerne, Neuchâtel, Schwyz and Valais don’t grant any environmental discounts at all.

A typical vehicle tax rate in Swiss cities car varies from 500 to 1,000 francs a year, though it could be more or less, depending on the car model. Motorcycles tend to vary between 200 to 500 francs. 

While vehicle taxes are compulsory, some charges are self-inflicted. For instance…

Speeding fines

A speeding ticket depends on where you are caught (a town or motorway) and by how much you exceed the speed limit.

While fines are more or less standard throughout the country, as this article explains, what changes are the administrative fees attached to each fine.

 A Comparis.ch study carried out in 2021 found that motorists in Neuchâtel are usually slapped with lowest costs (50 francs in administrative fees), followed by Lausanne (60 francs), and Fribourg (73 francs).

The further east you go, however, the higher speeding-related prices are, Comparis reports.

In Bern, exceeding the speed limit will set you back  200 francs, you will have to pay 300 francs in Glarus, 350 in Appenzell. 370 in Lucerne, 430 in Zurich, 450 in Schaffhausen, and the mind-boggling 500 francs in Aargau.

READ MORE : EXPLAINED: What you should know about speeding fines in Switzerland

Toll roads

Unlike most of Europe, Switzerland doesn’t have an abundance of toll roads; the system of stopping at a booth and paying for driving on a certain section of a road is replaced  by the 40-franc motorway sticker, which should be renewed each year.

More information about this vignette is here:

Swiss vignette: What you need to know about Switzerland’s motorway charge sticker

However, toll must be paid in two tunnels: the Grand St. Bernard and Munt la schera Tunnel. Both connect their respective cantons (Valais and Graubünden) with Italy.

In the Grand St. Bernard, the toll depends on the type of vehicle you drive (based on the number of axles), ranging from 29.50 francs or 27.80 euros for the smallest vehicle to 177 francs /167 euros for a truck. Note, however, that the franc-euro conversion was calculated in 2020; these days the two currencies are closer to parity.

You can find the tolls for all car types here.

At Munt la schera, the price of a one-way ticket for a standard passenger car from December to April is 29 francs if purchased online and 35 if paid for in the tunnel. Between May and November, the price is 15 francs online and 17 at the tunnel.

Tolls for other types of vehicles can be found here.

Fuel prices

The cost of gasoline has gone up since Russia invaded Ukraine in February 2022, topping 2 francs per litre nearly everywhere in Switzerland. Adding up to the already high costs is the fact that since January 1st, petrol in Switzerland has been taxed an additional 3.7 cents per litre to finance environmentally friendly fuels.

Before the war in Ukraine, the cheapest fuel could be found at Rasthof Platenenhof station in Gampelen, canton Bern.

Another cheap fuelling option was a few kilometres away, at the Pit-Stop de Boudevilliers in Val-de-Ruz in canton Neuchâtel.

In fact, this whole region benefited from cheaper gasoline due to its proximity to the Cressier-Cornaux refinery and large volume of purchases.

Another low-cost location is in Samnaun, canton Graubünden in the region of Engiadina Bassa / Val Müstair.

The price there is 30 percent cheaper than in the notoriously expensive Lake Geneva region.

And while we can’t really talk about “cheap” fuel these days, you could possibly save a few cents per litre if you shop smartly.

For instance, auto club memberships often offer discounts on petrol. ACS  and TCS members can save between two and five cents per litre. 

READ MORE: Where in Switzerland can you find the cheapest fuel?

Larger petrol retailers will also often have discount deals, while stations owed by Swiss supermarkets like Coop and Migros also offer occasional deals.

Prices are usually the highest on (or close to) motorways, in or near large cities, and at branded chain stations. You can find better deals at smaller, independent stations away from main roads.

However, you should avoid going too far out of your way to save on fuel.  

“A one-cent difference on the price of the litre justifies a detour of  two to three kilometers, at most. Otherwise, the excess consumption drowns the economy on a 50-litre tank”, said TCS’s Erich Schwizer.

One useful website listing cheaper petrol options throughout Switzerland is this.

Insurance

While your car insurance will largely depend on the type of vehicle and your driving record, geographical aspects count too.

The amount of premiums for car insurance can therefore vary from one canton to another.

The most expensive insurance (as pretty much everything else) is located near borders or large cities, such as Geneva, Zurich, and Basel, for instance.

The reason is that the number of accidents and claims higher in these cantons, impacting premiums.

The cheapest insurance policies, on the other hand, can be found in Obwalden, Nidwalden, Fribourg, Bern, and Appenzell Innerrhoden.

READ MORE: Ten ways to save on car insurance in Switzerland

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COST OF LIVING

EXPLAINED: What the steep rise in Swiss interest rates could mean for you

The Swiss National Bank (SNB) raised the key interest rate by 0.75 percentage points, putting it back in positive territory at 0.5 percent.

EXPLAINED: What the steep rise in Swiss interest rates could mean for you

As announced by Switzerland’s central bank on Thursday, the rate change applies from Friday, September 23rd.

“The bank’s aim is to counter the renewed rise in inflationary pressure and the spread of inflation to goods and services that have so far been less affected”, according to SNB.

The SNB has not said how long the current rate will be in place, but noted that “it cannot be ruled out that further increases in the SNB policy rate will be necessary to ensure price stability over the medium term”.

READ MORE: Swiss central bank announces big rate hike in inflation fight

Inflation rate in Switzerland currently stands at 3.5 percent. While it is much lower than in the eurozone, where it exceeds 9.1 percent, it is still higher than its usual rate of below 1 percent.

Why has the SNB raised the interest rate for the first time since 2015?

For the same reason that other central banks have done so, including the European Central Bank and the Federal Reserve in the US: price stability

In general, central banks see increasing interest rates as a response to rising inflation: higher rates help reduce the overall level of demand and, subsequently, also the upward pressure on prices.

Whether this strategy will work is another matter.

The SNB rate hikes will “have a fundamentally dampening effect on inflation”, Felix Oeschger, analyst at Moneyland price comparison platform, told The Local.

“However, it is far from clear whether these alone will be enough to curb inflation”, he added.

One for the reasons for this uncertainty, Oeschger said, is that “the energy crisis and the high prices of some agricultural commodities, such as wheat, are a result of the Ukraine war. These prices are more difficult to influence with key interest rate increases”.

In its inflation forecast, the SNB predicted the inflation will drop to 2.4 percent in 2023.

But “considering that the SNB has continuously revised its inflation forecasts upward since December 2021, it is quite conceivable that inflation in Switzerland will continue to rise or at least remain high”, Oeschger pointed out.

READ MORE: EXPLAINED: The groups most affected by inflation in Switzerland

Will the Swiss consumers benefit (or not) from the higher interest rates?

It depends on what you are looking to buy.

If you are planning to buy big-ticket items that are usually purchased with credit — like homes — then you may have to dig deeper into your pockets.

If you already have a fixed-rate mortgage, then you are safe from rate increases for the term of your mortgage.

But for new buyers or those with variable-rate mortagages, things may be more problematic.

“It is not excluded that mortgage interest rates will reach 3 to 4 percent next year”, from the current 2.6 to 3.1 percent, according to Donato Scognamiglio, director of real estate platform Iazi.

What about rents?

Tenants may not be better off than homeowners.

Many have already received notices of higher rents to compensate for increased costs of energy.

Now another charge could be added as well, though probably not immediately.

“Rents will go up, but only when the reference interest rate itself is raised”, Scognamiglio said.

The benchmark interest rate is the average of all mortgage interest rates. If the reference rate increases by 0.25%, tenants will have to pay 3 percent more rent. “I expect this to happen next year”, he said.

But it is not all bad news; higher interest rates will yield some benefits as well.

For instance, if you have certain types of investments, you may see more money coming in.

“I expect yields on fixed-income financial products such as bonds to continue to rise”,  Oeschger said.

“In the case of medium-term notes issued by Swiss banks, we have already seen significant increases since the beginning of the year”, he added.

As for savings accounts, however, “the banks have so far been very hesitant to raise interest rates, but if monetary policy tightens further, we can expect interest rates to rise slightly here as well”.

Generally speaking, what will become cheaper and more expensive for consumers?

The bad news here is that everything that has to do with energy, even indirectly, will become more expensive.

This includes “heating, transport costs, electricity and also food”, another Moneyland expert, Ralf Beyeler told The Local.

READ MORE: Pasta up by 13 percent: How food and energy prices in Switzerland are rising

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