Switzerland consultation on extending VAT deemed supplier to Digital Platforms and reforming mixed-supply taxation
Switzerland has launched a formal consultation on targeted amendments to its Value Added Tax Act (LIVA), signalling a potential shift in the taxation of digital platforms and bundled services.
The Federal Council approved the consultation package on 5 December 2025, with stakeholders invited to comment until 19 March 2026. The proposals are designed to implement two parliamentary mandates, while introducing several technical adjustments to streamline the operation of the VAT system.
The changes reflect global trends on digital marketplace deemed supplier shift, and the EU’s ViDA.
Extending 2025 VAT platform reforms to electronic services in 2026
Switzerland has already legislated for a major structural change taking effect from 1 January 2025: online platforms will assume the VAT deemed supplier on sales of goods made through their marketplace, instead of the underlying sellers.
The consultation explores whether this platform liability mechanism could be expanded to digital services, specifically digital content distributed to Swiss consumers, such as:
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Software and apps
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Video games
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Films and streaming media
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Music and audio services
In effect, platforms would be treated as deemed suppliers for VAT purposes, accountable for charging, collecting, and remitting Swiss VAT.
This would align Switzerland with a broader international move to shift VAT compliance obligations from thousands of dispersed vendors to a small number of large, well-regulated intermediaries.
However, two sectors are explicitly excluded from the proposal:
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Passenger transport services offered through apps
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Short-term accommodation rental platforms
These remain governed by existing VAT rules.
Website blocking for non-compliance
To support compliance under the digital platform model, the Federal Council proposes granting the Federal Tax Administration a last-resort power to block access to online offers if platforms fail to meet VAT obligations.
This would introduce a significant compliance enforcement tool, comparable to mechanisms seen in several EU jurisdictions for remote gambling or unregistered digital suppliers.
Revision of VAT treatment of combinations of services
The second core measure relates to so-called “combinations of services”, common in sectors such as tourism. Examples include:
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Hotel stays bundled with meals
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Packages incorporating ski passes, wellness facilities or other services
Under current rules, a bundle may be taxed at the VAT rate of the dominant component if that component accounts for at least 70 percent of the value.
The amendment proposes lowering the threshold from 70 percent to 55 percent.
This would make it easier for packages to be taxed at a reduced rate (for example, the special rate for hotel accommodation), thereby lowering the VAT burden on mixed offers.
The Federal Council previously opposed this reform, arguing that it operates as a de facto VAT reduction. The current proposal acknowledges this policy cost but responds to the parliamentary mandate.
Federal Council estimates millions in revenues
The Federal Council’s initial assessment suggests that both the extension of platform VAT obligations to electronic services and the change in mixed-supply rules would reduce VAT revenues by “a few tens of millions of francs” each.
Although modest relative to total VAT receipts, the measures represent a meaningful shift in both policy direction and tax administration.
Consultation timeline and next steps
The consultation procedure runs until 19 March 2026, following which the Federal Council will assess responses and finalise a draft bill for parliamentary approval.
The outcome of the consultation will determine the extent to which Switzerland aligns with the international trend towards platform-based VAT collection and incentivises tourism through lower-rated bundled offerings.
See our Swiss VAT guide for more background.
