Location promotion Basel-Stadt responds to OECD minimum taxation with support package
The canton of Basel-Stadt wants to respond to the forced profit tax increase due to the OECD minimum taxation with a support package in the areas of innovation, families and the environment. A fund with annual contributions of between 150 and 300 million francs is to be set up for this purpose.
With this package, Basel-Stadt wants to maintain its attractiveness as a business location, as Finance Director Tanja Soland and Kaspar Sutter from the Department of Economic, Social and Environmental Affairs (both SP) said at a media conference on Monday.
The introduction of the OECD minimum tax rate of 15 percent on the profits of large international companies means that the canton will have to increase the current comparatively low profit tax rate of 13 percent to this 15 percent with a supplementary tax.
Sutter said that this would lead to additional revenue for the canton despite the federal share of 25 percent. At the same time, however, an important locational advantage of the life sciences city of Basel would be diminished.
The canton is expecting additional revenue of around CHF 270 to 310 million per year. This money is now to be invested in measures to maintain the quality of the location. Specifically, the government wants to build up a fund with annual contributions of 150 to 300 million francs, depending on the expected additional revenue.
Most money for research and innovation
From 2025, this fund will be used to finance compensatory support measures in the areas of innovation, society and the environment.
With a share of 80 percent, most of the money is to flow into the promotion of personnel expenses for research, development and innovation - aspects that play an important role in Basel as a life sciences location. Commitments to Basel as a location and the establishment of new facilities for research, development and innovation should also be eligible for funding.
The canton also wants to provide financial support to companies that grant parental leave that exceeds the legal minimum. And finally, climate protection measures, in particular those that serve to reduce greenhouse gases and increase energy efficiency, are to be financially rewarded.
These support measures should not only benefit international companies with a turnover of over 750 million euros that are targeted by the OECD minimum taxation, said Sutter. Smaller companies and start-ups should also be able to apply for funding.
For the implementation of the location promotion measures and the tax measures, the Government Council is proposing a partial revision of the Location Promotion Act and the Tax Act to the Grand Council. The government council will regulate the details in an ordinance, said Soland.
Different reactions
In their initial reactions, the SP and the Basel Chamber of Commerce agree with the basic thrust of the government council's proposals. In detail, their statements point in opposite directions.
The Chamber of Commerce wants to focus even more strongly on promoting innovation and is critical of the promotion of parental leave and the establishment of new research facilities, for example. The business association wrote that politics is interfering too much in the private sector here.
The SP described the ratio of funding areas as unbalanced. The party will work to ensure that greater consideration is given to the areas of society and the environment.
