Switzerland:
Switzerland with its citizen friendly tax system is located in the center of Europe. Good flight connections and a network of high-speed trains connect the region of Zurich with Europe`s main regions. Low payroll fringe costs and longer working hours lead to high salary levels, and together with factors like high security and quality of life this attracts well qualified employees. Switzerland is proud of its clean environment, direct democracy, and many recreational offers.
Critics mention high personnel costs, high administrative costs, low productivity of knowledge workers, as well as the tendency to use Machiavellian tactics and hide mistakes. Optimal solutions can thus be found in multilateral structures, and their environments can be used to offset the disadvantages of Switzerland.
Nationalism: according to a study by the Federal Statistical Office of 2008, 30,9% of the population over 15 years have an immigration background (they are themselves immigrated or their parents were born abroad). However, persons with one Swiss and one foreign parent are not defined as immigrants, so the proportion of the population who have either immigrated to Switzerland or have at least one parent who has immigrated is significantly higher than the published figrure. In spite of this fact, most residents perceive themselves as proud members of Switzerland.
Zug:
The canton Zug is located in the middle of central Switzerland, about 20 km southeast of Zurich. Its capital is the city of Zug, which forms a conglomerate of about 70,000 inhabitants together with the neighboring villages Baar and Cham, and other surrounding communities.
From airport Zürich Kloten, there is a direct connection every hour (journey time 35 minutes).
Where does the name Zug come from? The place where the fishing nets were drawn ashore, was called “Zug” (substantive of the german word “ziehen” – to draw).
Political system:
The culture of Switzerland is characterized by vivid stories about struggle for freedom: after the opening of the Gotthard pass in the early 13th Century, the region around Lake Lucerne became economically interesting. The Habsburgs raised their ownership claims and sent bailiffs into the country, which oppressed the population and scooped a massive tax.
In 1291 the representatives of the cantons of central Switzerland vowed the Rütlischwur "to protect our freedom against any foreign power and violence, for ourselves and our children." As a result, they managed to expel the aristocrats and their violent bailiffs, and in 1351, the confederation (Eidgenossenschaft) was launched.
The following centuries showed the populations high esteem for the value of freedom, and even if a war sometimes had forced them to submit to a foreign power, they historically had always succeeded short time later to gain back freedom.
Even today, this spirit can be felt: Switzerland is neutral, did not join the EU and has a deep understanding for oppressed citizens of other countries (which are not always correctly represented by the media with their EU-friendly reports). Today the image of some finance ministers of EU countries is similar to the image the hated bailiffs had in Switzerland some centuries ago.
The 26 cantons in Switzerland have remained fairly autonomous. Federal Laws (including federal tax laws) may be decided by Parliament, but only 50.000 votes from Swiss voters are sufficient to initiate a referendum against the law (at a referendum all voters of the whole population are invited to vote, and for a tax increase, a majority of votes would be required).
Economic freedom is a fundamental right in Switzerland, it is guaranteed in Article 27 of the constitution and this serves to protect the individual against the state. Swiss laws allow the registration of businesses that require complicated registration in other states.
International treaties:
a. No membership of the EU and EEA: Switzerland is neither a member of the EU, nor (as Liechtenstein), a member of the EEA (European Economic Area). It is therefore not bound by EU directives. In particular, Switzerland is able to provide many forms of economic promotion that are not allowed to EU countries according to EU treaty.
b. Schengen Agreement: since the final implementation of the agreement there are no controls of persons at the border, but there are systematic checks for goods at the border and at the main routes into and out of Switzerland. Smaller border stations, however, often remain unoccupied.
c. AFMP agreement with the EU: (agreement on the free movement of persons and the update of the convention establishing the European Free Trade Association (EFTA) since mid-2007, EU citizens can move to residence in Switzerland, if they prove to have a residence, a health insurance, an employment (possible in the own company) or the availability of sufficient financial resources. However, as Switzerland is not part of the EU, entrepreneurs have to consider how to avoid exit tax.
d. numerous double taxation agreements (DTA): Switzerland has DTAs with over 65 countries. These DTAs have priority over the national tax laws. This offers interesting possibilities, particularly with cross border dividends and silent partnerships. DTAs provide long-term legal security: while national governments can change their tax laws fairly quickly, double taxation agreements are bilateral treaties, which often remain unchanged for decades and are rarely terminated unilaterally.
e. co-operative attitude towards OECD: while Switzerland applies various tactics to defend its freedom against the demands of individual states, at the same time it has repeatedly responded to criticism of OECD or the EU in recent years. Some of the consequences were the Savings Tax Agreement with the EU, an enhanced assistance of Swiss authorities and a more cooperative practice in the interpretation of bank secrecy. While it is important to be prepared according to relaxation of bank secrecy, it can be expected that Switzerland will create new incentives for companies and investments in the financial sector.
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