"50% Inheritance Tax on the Super Rich"... Country to Hold National Referendum in November

Switzerland to Hold Referendum on '50% Inheritance Tax' for the Super-Rich
Debate Intensifies Amid Fears of Wealthy Exodus

Switzerland, known as a country with a high concentration of high-income earners, will hold a national referendum in November to decide whether to introduce a 50% inheritance tax on ultra-high-net-worth individuals. The proposal aims to secure funding needed to address climate change, but political and business circles are strongly opposing it, arguing that it will trigger a mass exodus of wealthy individuals.

According to Bloomberg News on July 2 (local time), the Swiss government announced the previous day that it would hold a nationwide referendum on November 30 to decide whether to adopt a 50% inheritance tax, as proposed by the Young Socialists (JUSO). This referendum was made possible after JUSO collected more than 100,000 signatures. Under Switzerland's "popular initiative system," any proposal that receives over 100,000 signatures must be put to a national vote.

Panoramic view of Baden, Switzerland. Swiss Tourism Board

The core of the proposal is to impose a 50% tax on the portion of inherited assets exceeding 50 million Swiss francs (approximately 85.7 billion won). The revenue generated from this tax would be used as public funds to address climate change and to build sustainable social infrastructure. JUSO argues that "in the era of climate crisis, the wealthy should bear greater responsibility."

However, the Swiss government and the Federal Assembly have unanimously expressed opposition, stating that "an excessively high inheritance tax would drive the wealthy out of the country, leading to fiscal losses and job reductions, among other negative ripple effects." Currently, the top 1% of wealthy individuals in Switzerland own 45% of total assets, and the top 10% of taxpayers account for 53% of income tax revenues. The government warns that such a high inheritance tax could threaten the very foundation of the tax base, citing this tax structure as the reason.

The report also analyzed that, as ultra-high-net-worth individuals have recently been flocking to Switzerland due to the abolition of the UK's non-domiciled tax benefits and the introduction of a wealth tax in Norway, the passage of this proposal in the referendum could reverse this trend. Switzerland has established itself as a hub for wealthy individuals worldwide, thanks to its low tax rates and financial stability.

Centrist and right-leaning political parties, along with major economic organizations, have formed an "Anti-Inheritance Tax Coalition" and launched a full-scale campaign. In a statement, they argued that "harsh tax rates make it difficult for family businesses to be passed down to the next generation and could also burden the middle class," adding that "this is not simply a tax on the wealthy, but a measure that would negatively affect the entire national economy."