Switzerland may become a new tax haven for businessmen, Israelis included, following changes in Swiss tax code. The changes come on top of the fact that Switzerland is the country with the largest number treaties for prevention of double taxation, including one with Israel, and Israelis can exploit its provisions.
The first signs of this emerging tax haven is a multifold increase in the number of companies established in Switzerland in the past two years. A study by Adv. Avi Nov, a tax expert at the Eitan Mehulal Law Group found that 40,000 new companies were established in Switzerland in 2007, a third of them foreign firms, including hundreds of Israeli companies. Many of Switzerland's 26 cantons have seen the number of companies registered increase by more than 50%.
The substantial growth in the number of companies established in Switzerland is due to the far-reaching changes in the country's tax code, which provide opportunities for Israelis seeking ways to reduce their tax bill. Nov said that Switzerland's location in Central Europe and its attractive tax regime have made it ideal, both in terms of business and taxes, to serve as the location for trading, holding, and financial companies.
Nov says that one of the reasons for the increase in the number of companies in Switzerland is competition between cantons to attract foreign investment. He said that tax planning can cut a company's tax liability to a rate of 0-4% on income, the lowest level in Europe.
Published by Globes [online], Israel business news - www.globes-online.com - on February 4, 2008
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