+44 7393 450837
advice@adamfayed.com
Follow on

8 Reasons to Invest in Switzerland

Hear are 8 compelling reasons why you should invest in Switzerland.

If you have any questions or want to invest as an expat or high-net-worth individual, you can email me (advice@adamfayed.com) or use WhatsApp (+44-7393-450-837).

Introduction

Due to its taxation structure, geographic and political location, low inflation, highly qualified individuals, and competitive business climate, Switzerland has become a desirable destination for investors. One of the most well-known facts about Switzerland is its economic stability.

As a result of its economic, social, and political stability, as well as a clear and equitable legal system, this country is an appealing place to establish a business. Furthermore, dependable and extensible infrastructure, as well as efficient financial markets, are critical. Swiss cantons provide a plethora of tax breaks to entice businesses to invest in their territories. As a result, some of the cantons go so far as to exclude new enterprises from paying taxes for up to ten years.

Due to its business strategy, which attempts to create the optimum platform for international investors, Switzerland is a very enticing business hub for global corporations. As a result, around 30% of the world’s most well-known brands have offices in this nation. In fact, 15 Fortune 500 companies have headquarters in Switzerland, including Nestle, Glencore International, Novartis, Roche Group, and ABB.

1. Switzerland is politically neutral

Despite the fact that Switzerland has never joined either the North Atlantic Treaty Organization or the European Union, it frequently serves as a middleman in international political disputes. Switzerland is a member of the European Free Trade Association and, since 2008, of the Schengen Area, although not being a member of the European Union. Switzerland is a signatory to Double Taxation Agreements with over 70 countries so far in order to avoid double taxation on the same goods. Ten tax information-sharing agreements have also been agreed upon and signed by Switzerland.

2. Switzerland’s geographic position is strategic

Switzerland is a strategic position for European markets, benefiting from economic, fiscal, and political stability, as well as a transparent government and a central geographical location in Europe. The geographic location of Switzerland, in the heart of Europe, might be seen as a benefit for investors looking to put their money in this country.

Switzerland is regarded as an accessible nation because of its infrastructure, providing vehicle access to over 30 European countries. In fact, according to the 2016-2017 Global Competitiveness Report, Switzerland is the most competitive country in Europe and is on par with Singapore and the United States on a global scale.

8 Reasons to Invest in Switzerland
Nestle headquarters in Vevey, Switzerland

3. Switzerland has the most attractive market for foreign investors

EU or EFTA citizens can easily establish a company in Switzerland or engage in other economic activities there. Despite its modest size, Switzerland is recognized by its cultural richness and serves as an excellent test market for new services and products. Before expanding their offering to other areas, many firms evaluate the reception of potential clients on the Swiss market. Starbucks, the well-known American coffee corporation, for example, established its first European branch in Zurich in 2001. After 18 years, the coffeehouse chain is already present in the majority of European nations.

4. Switzerland has highly-skilled professionals

A lot of foreign corporations are intending to invest in Switzerland because of its high level of skills and education. Switzerland has a literacy rate of 99 percent, making it the world’s sixth most literate country. As a result, several well-known international corporations have chosen to transfer their headquarters and, in some circumstances, their entire workforce to Switzerland. Over 22.7 percent of Switzerland’s population does not hold a Swiss passport.

Switzerland is concentrating on having one of the greatest educational systems and human resources as a supplement to its limited natural resources. As a result, ETH Zurich Institution is regarded as one of the best in the world and a prominent European university.

5. Switzerland’s laws are friendly to foreign investments

Switzerland values foreign investment as critical to economic progress, and as a result of its exports of industrial goods and services, it is a well-known destination for direct investment. At the same time, it gets significant foreign capital investments, and many investors interested in establishing businesses in Switzerland is gradually expanding. The State Secretariat for Economic Affairs is the body in charge of establishing rules and legal frameworks for foreign investment (SECO).

Bilateral investments and agreements (BITs) are therefore shielded against international law infractions. The SECO also negotiates market access terms in order to acquire fair and non-discriminatory actions. At the same time, the authority is involved in the formulation of the Swiss Confederation’s investment strategy.

6. Switzerland has foreign investment protection policy

The World Trade Organization (WTO) coordinates the international investment laws that apply to Switzerland. It should be emphasized, however, that Switzerland has not recently been embroiled in any major global controversy over foreign investment. This is due to its open and liberal foreign investment policy. At the same time, in order to prevent foreign investors from being taxed both here and in their home country, Switzerland has inked double taxation agreements with a significant number of nations.

8 Reasons to Invest in Switzerland
Glencore headquarters in Switzerland

7. Switzerland has a friendly taxation system

Currently, there are over 6500 foreign investors in Switzerland who contribute more than $5 billion to the country’s GDP each year. Furthermore, these businesses employ about 15000 Swiss nationals on a permanent basis.

This is why the Swiss government is interested in preserving its tax status by enacting a tax reform that will enable even more investment in the future while still conforming to international standards.

The cantonal tax rate laws, according to Swiss law, should take precedence over federal tax rate laws. As a result, Switzerland has made it possible for each canton to implement its own tax breaks for investment projects in order to attract investors. Zug, Schwyz, Slon, and Stans have some of the lowest tax rates, starting at 1.78 percent, while Lausanne, Basel, Solothum, and Neuchatel have the highest tax rates, reaching 9.96 percent for a couple with 2 children.

Because of the aforementioned factors, Switzerland will continue to be the finest investment location for international investors seeking long-term asset growth. Furthermore, labor market law is founded on liberal ideals that favour companies.

Overall, Switzerland is viewed as a tax haven, although the low taxation is due in part to the fact that over 70 double taxation treaties have been signed, allowing corporations and international investors to benefit from reduced tax rates. Taxes are imposed at the federal, cantonal, and municipal levels, and are among the lowest in the European area, both for people and for legal businesses.

Except for those imposed by the federal government, Swiss cantons and municipalities have a great deal of autonomy when it comes to tax rates and deductions. There is a genuine rivalry between cantons in terms of tax rates to attract investors to invest in Switzerland, which can only benefit people who wish to start a business in Switzerland. The bureaucratic requirements for forming a corporation have been considerably streamlined, resulting in greater transparency in the corporate climate. The Swiss legal system makes forming a new business reasonably simple, taking only a few weeks on average. Real estate for commercial use can also be purchased without the requirement for specific approvals.

Cantons also provide a variety of tax breaks to businesses that create new employment in the area. This boosts the local economy, therefore it’s a win-win scenario for everyone. Foreign enterprises can also take advantage of numerous tax breaks provided by the federal government.

8. Switzerland has low mortgage rates

Mortgage rates over 10 years might be as low as 1.5 percent in Switzerland. Due to a new regulation that makes it harder for Swiss to develop and own new secondary residences while also prohibiting foreigners from doing so, capital appreciation on property values should be on the increase. As a result of the absence of new property stock, existing properties should appreciate in value.

Conclusion

In recent years, an increasing number of entrepreneurs have chosen to establish businesses abroad in order to take advantage of tax or legal benefits, which in certain situations may even be favourable to international investors. Many entrepreneurs prefer Switzerland because of the taxes and economic laws, which are constantly evolving and offer several benefits to international investors. If you are decided to invest in Switzerland, consider talking to a financial advisor or an investment expert.

Pained by financial indecision? Want to invest with Adam?

smile beige jacket 4 1024x604 7

Adam is an internationally recognised author on financial matters, with over 760.2 million answer views on Quora.com, a widely sold book on Amazon, and a contributor on Forbes.

This website is not designed for American resident readers, or for people from any country where buying investments or distributing such information is illegal. This website is not a solicitation to invest, nor tax, legal, financial or investment advice. We only deal with investors who are expats or high-net-worth/self-certified  individuals, on a non-solicitation basis. Not for the retail market.

SUBSCRIBE TO ADAM FAYED JOIN COUNTLESS HIGH NET WORTH SUBSCRIBERS

SUBSCRIBE TO ADAM FAYED JOIN COUNTLESS HIGH NET WORTH SUBSCRIBERS

Gain free access to Adam’s two expat books.

Gain free access to Adam’s two expat books.

Get more strategies every week on how to be more productive with your finances.