The OECD’s minimum tax: what are the implications for Switzerland and SMEs?

Introduction

The OECD’s minimum tax is one of the most important international tax issues for Switzerland. It does not apply to all businesses, but it affects a key aspect of the Swiss economy: the attractiveness of Switzerland as a tax location for international groups, regional headquarters, finance companies, research centres and holding companies. Even where an SME or a self-employed person does not fall directly within the scope of the reform, the issue merits attention, as the tax decisions of large groups often influence value chains, investment, skilled jobs and cantonal tax revenues.

The starting point is clear: in October 2021, more than 140 countries, including Switzerland, committed to introducing a minimum tax rate of 15% on the profits of large multinational groups with an annual turnover of at least €750 million. For Switzerland, the challenge is therefore not merely to levy an additional tax. It is also a matter of preventing other countries from claiming a share of the tax when profits generated in Switzerland are deemed to be insufficiently taxed under international rules.

Since 1 January 2024, Switzerland has been applying a supplementary national tax on the basis of a transitional ordinance. The measure must then be replaced by a federal law within six years. Meanwhile, the debate remains very much alive: revenue sharing, the role of the cantons, effects on tax competition, administrative burden, corporate reactions and international developments. Recent discussions regarding the treatment of US groups, as analysed in particular by Avenir Suisse, show that the framework is not set in stone. For Swiss companies, the right approach is therefore to understand the mechanism, identify possible indirect effects and remain attentive to cantonal and federal adjustments.

What are we talking about?

The OECD’s minimum tax aims to ensure that large multinational groups pay a minimum level of tax on their profits, regardless of how they allocate their activities and profits across countries. The general idea is simple: if an entity within a group is taxed at a rate below the prescribed minimum, an additional tax may be levied to make up the shortfall. In practice, the mechanism is complex, as it relies on consolidated calculations, international definitions of taxable profit and rules for allocating profits between jurisdictions.

In Switzerland, the mechanism forms part of a federal tax system. The cantons retain an important role in corporate taxation, whilst the Confederation coordinates the implementation of international commitments. To enable the reform to be implemented swiftly, Switzerland has amended its Constitution. This legal basis allows the Federal Council to introduce the rules via a transitional ordinance, which came into force on 1 January 2024. This transitional approach is not intended to last indefinitely: according to the Federal Department of Finance’s dossier, it must be replaced by a federal law within six years.

A distinction must be made between the standard profit tax, with which companies are already familiar, and the supplementary tax linked to the minimum tax. A company may continue to pay its cantonal and federal tax in accordance with the ordinary rules. If the effective rate calculated in accordance with international rules is below the applicable threshold for a large group concerned, a top-up may be added. The main players are therefore multinational groups, their Swiss subsidiaries, the cantonal tax authorities, the Confederation and, indirectly, foreign states that also apply the OECD rules. For an independent SME, the mechanism generally has no direct tax impact, but it may alter the economic environment in which it operates.

What the facts show

The available facts provide a clear framework for the issue. The reform concerns large, internationally active corporate groups with an annual turnover of at least €750 million. According to the Federal Department of Finance, around 99% of Swiss companies are not directly affected. The scope of application mainly covers a few hundred Swiss groups and a few thousand foreign groups with subsidiaries in Switzerland. This clarification is essential: the minimum tax is not a new general tax on all Swiss companies.

Switzerland introduced the national supplementary tax on 1 January 2024. According to the Fédération des entreprises romandes Genève, the international supplementary tax based on the income inclusion rule, often referred to by its English acronym IIR, is scheduled to come into force on 1 January 2025. The Federal Department of Finance estimates that the additional revenue from the Swiss supplementary tax will amount to between 1 and 2.5 billion Swiss francs per year during the initial years. The planned distribution has also been defined: 75% of the revenue will go to the cantons and 25% to the Confederation.

The positions of the various stakeholders are not uniform, but several trends are emerging. The Federal Council supports the implementation, particularly to preserve Switzerland’s attractiveness and prevent other countries from taxing the Swiss companies concerned in its place, according to SwissBanking. The FER Geneva also advocates the reform, highlighting the benefits of retaining the additional tax revenue in Switzerland and limiting additional taxation abroad. Deloitte Switzerland, for its part, notes that the impact will vary across groups: some will be heavily affected, others little or not at all. Finally, Avenir Suisse points out that international developments, notably the so-called ‘side-by-side’ package adopted in early 2026 under US pressure according to its analysis, further complicate the landscape and call Switzerland’s options into question.

Practical implications for an SME or a self-employed person

For the vast majority of SMEs and the self-employed, the direct tax impact is limited, or even non-existent. If your business does not belong to an international group exceeding the specified turnover threshold, it will continue to be taxed according to the standard rules applicable to its legal form, canton and circumstances. A craft-based SME, a local service company, a start-up that is still independent, or a professional practice will not automatically be subject to the OECD supplementary tax. This is reassuring, but it does not mean the matter can be completely ignored.

The indirect effects may be more tangible. An SME supplying a large group may face new requests for information, a reorganisation of contracts or changes to the client’s internal processes. An international group reviewing its tax structure may relocate certain functions, centralise procurement, alter transfer pricing or adjust its investments. These decisions may influence order volumes, payment terms, documentation requirements or the location of certain projects. For SMEs integrated into international supply chains, it is therefore useful to monitor the signals sent by major clients.

Another possible effect concerns the cantonal environment. Low-tax cantons, where many large companies are based, are particularly exposed to the reform. The Federal Department of Finance’s report indicates that some cantons are considering increasing their corporate tax rate to reach the minimum rate of 15%. Depending on how these adjustments are designed, SMEs not affected by the OECD rules might wonder whether their own standard tax burden will change. One should not jump to conclusions: cantons can choose different instruments, and the effects vary depending on each company’s situation. However, an SME manager would be well advised to factor this in when making forecasts, particularly when planning an investment, an inter-cantonal relocation or a restructuring.

Points to watch and uncertainties

The first point to watch is international uncertainty. The minimum tax relies on coordination between states. Yet this coordination is evolving. Avenir Suisse believes that the specific treatment granted to US groups under the side-by-side package undermines the principle of a uniform system. According to this analysis, there is now a tension between the OECD regime and the US regime, with the latter potentially being less strict, particularly because profits taxed at a low rate in certain countries can be offset by profits taxed at a higher rate elsewhere. Avenir Suisse also notes that US rules can lead to effective tax rates sometimes falling below 10%. For Switzerland, this poses a challenge: how can it remain attractive without creating new inequalities in treatment or exposing itself to reactions from other countries?

The second point concerns revenue. Estimates of CHF 1 to 2.5 billion per year in the early years provide a rough guide, but they remain estimates. Actual revenue will depend on corporate behaviour, changes in cantonal rates, foreign rules and the economic climate. If companies reorganise their operations or shift profits, revenue may differ from forecasts. Cantons relying on these resources will therefore need to remain cautious in their financial planning.

The third point is the administrative burden. The OECD rules are not simply a matter of a tax rate. They involve calculations, documentation, checks and coordination between group entities. Even if an SME is not directly subject to the scheme, it may be involved if it belongs to a larger group or if it provides information to an affected partner. Finally, inter-cantonal tax competition could change. The Federal Department of Finance notes that the reform may reduce the advantage enjoyed by low-tax cantons and make higher-tax cantons relatively more attractive. The extent of this effect, however, remains to be seen on a canton-by-canton basis.

What to do in practice

For a Swiss SME or a self-employed person, the first step is to determine whether the business falls directly within the scope of the reform. In most cases, the answer will be no. However, attention must be paid to group structures: a small Swiss company may form part of an international group exceeding the applicable threshold. In this case, the matter is not dealt with solely at the level of the Swiss entity, but in consultation with the parent company, the group’s tax specialists and financial managers. A simple internal review can already clarify the status: group membership, consolidated turnover, presence of foreign subsidiaries, and the role of the Swiss entity.

The second step is to monitor changes at cantonal level. As 75% of supplementary tax revenue is allocated to the cantons, they play an important role in the economic response to the reform. Some decisions may concern tax rates, others measures to boost attractiveness, support innovation or improve the business environment. An SME planning to set up, relocate, undergo a legal restructuring or expand across cantons should factor this development into its analysis, without limiting itself to the nominal profit tax rate.

The third step is contractual and operational. If your company works with multinationals, be mindful of new clauses, reporting requirements or changes to invoicing. It may be useful to clearly document the services provided, the responsibilities assumed, the agreed prices and cross-border flows. This practice is already sound in accounting and tax matters; it becomes even more important in an environment where large groups are strengthening their compliance.

Finally, it is advisable to consult a professional when the situation goes beyond a simple local context: membership of a group, transactions with related companies abroad, operations in several cantons, restructuring, intra-group financing or sale to an international group. The rules are technical and subject to change. A case-by-case analysis helps to avoid overly general conclusions and to distinguish the actual tax impact from mere contextual effects.

Key takeaways

The OECD’s minimum tax should not be viewed as an ordinary tax reform affecting all businesses. It is primarily aimed at large international groups and seeks to ensure a minimum level of taxation on their profits. For Switzerland, the challenge is twofold: to comply with the international framework whilst maintaining the attractiveness of an economy closely linked to foreign groups and Swiss companies operating abroad.

• Check whether your company belongs to an international group with an annual turnover of at least €750 million; if not, the direct tax impact is generally limited.
• Follow the decisions of your canton, particularly if you are in a low-tax canton or if you are planning to set up a business, merge, restructure or make a significant investment.
• Anticipate indirect effects if you work with large groups: requests for information, contractual adjustments, reorganisation of procurement or changes to compliance processes.
• Do not confuse the standard rate with the supplementary tax: the OECD mechanism is based on a specific calculation and is not limited to the rate published by a canton.
• Remain cautious regarding international announcements, particularly concerning the treatment of US groups and the options under discussion for Switzerland; the framework may still evolve.
• Consult a fiduciary or tax specialist if your structure involves cross-border links, related companies or group transactions.

In practice, the best approach for an SME is targeted monitoring rather than a hasty reaction. Companies not directly affected must, above all, understand their indirect exposure, maintain proper documentation and incorporate cantonal developments into their strategic decisions. For affected Swiss groups or subsidiaries, a specialist analysis is essential to ensure the accuracy of calculations, filings and coordination with other jurisdictions.