While the proposal, spearheaded by the right-wing Swiss People’s Party (SVP) is not new (read more about this below), the Federal Council is now examining the possibility of implementing this tax, Tages-Anzeiger reported on Monday.
The principle behind SVP’s idea is to make immigration more expensive and therefore less appealing.
Only those who can afford to stay or are essential to Switzerland’s economy would be allowed to enter the country.
Under the proposal, part of the revenue from this tax would be used to offset the costs generated by immigration, such as the scarcity of housing and overuse of Switzerland’s infrastructure.
SVP’s stance is an offshoot of its initiative, ‘No to Switzerland of 10 million people’, which seeks to stop the influx of foreigners when the permanent resident population exceeds 9.5 million (it currently exceeds 9 million).
Although the SVP collected enough signatures to bring this issue to the ballot box, the date for the vote has not yet been set.
Beneficial impact
Not surprisingly, many in Switzerland are opposed to the ‘entry fee’ idea.
They criticise the fact that the proposed tax focuses only on the costs of immigration, while ignoring the usefulness of immigrants for the Swiss economy, including the contribution they make toward financing the country’s infrastructure and social scheme through their taxes.
READ ALSO: Immigrants make positive contributions to Swiss social system
“Switzerland needs specialists from countries outside the EU to maintain its leading position in research and development,” said Rudolf Minsch, chief economist at Economiesuisse, the umbrella organisation for the Swiss business sector.
It fears that if implemented, such a move would further exacerbate the existing labour shortage, as it would discourage foreigners from coming to Switzerland and Swiss employers from hiring them.
‘Watered down’ version
The Federal Council is examining the less radical version of the original SVP proposal, by focusing only on immigrants from third countries.
In a parliamentary motion submitted in December 2023, SVP’s deputy Andrea Caroni asked the government to impose the tax on all foreigners, including those from the European Union and EFTA nations (Norway, Iceland, and Liechtenstein).
This idea is not exactly new: it comes from Swiss economist Reiner Eichenberger, who said that Germans who work in Switzerland earn 30 percent more here and Italians as much as 70 percent more.
And if lower Swiss taxes are taken into account, “an average German immigrant makes a net profit of about 30,000 francs per year. At the same time, he or she benefits from the infrastructure that has already been paid for by the local population."
However, Switzerland can’t consider such a drastic idea, as it would violate the terms of the Free Movement of Persons agreement it has with the EU.
READ ALSO: Could foreigners in Switzerland be forced to pay 'immigration tax'?
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