Amendment of the Federal Act on Direct Federal Taxation

On the 27 of September 2020 the Swiss electorate voted on the Amendment of the Federal Act on Direct Federal Taxation.


In brief

Parents can claim tax allowances for their children. Under the system of direct federal taxation, they can deduct CHF 6,500 from their taxable income for each child. They can make a further deduction of up to CHF 10,100 per child if they send their child to a children’s day-care centre while they are at work. At federal and cantonal level, further deductions are also possible.

The Federal Council and Parliament want to increase the maximum allowance for childcare outside the family from CHF 10,100 to CHF 25,000 francs per child for direct federal taxation. They want to help make it easier for parents to work and raise a family, and so at the same time alleviate the shortage of skilled workers. Increasing this allowance will lead to a reduction in tax revenue of roughly CHF 10 million every year. Parliament has also decided to increase the general allowance for children from CHF 6,500 to CHF 10,000. This will reduce the tax burden on families irrespective of their choice of childcare, but will lead to a further reduction in tax revenue, estimated before the corona crisis at CHF 370 million. As a result of the corona crisis, this reduction may be temporarily lower, and has been estimated at CHF 50 to 100 million in the 2021 tax year. As the cantons receive a share of the revenues from direct federal taxation, they will lose out to the extent of around 20 per cent of the entire reduction in revenues. The increase in the allowances will benefit the almost 60 per cent of families that have to pay direct federal tax.



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Last modification 11.07.2022

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