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Switzerland draft marketplace deemed supplier VAT rules – 2024?

Tax loophole to be closed possibly 2024 by making platforms responsible for VAT

Switzerland is set to follow the EU by imposing deeded supplier obligations on digital platforms. This makes them responsible for the VAT charging and remittance on low-value imported consignments being sold to consumers. The Bill on shifting the tax responsibility from sellers to their digital platforms has gone to the second chamber of the Parliament having already been approved by the Federal Council and First Chamber.

The soonest the modification could be made is 1 January 2024.

Need for level-playing field on VAT for local e-commerce

Currently, imported consignments with an intrinsic value not exceeding CHF 5 are VAT exempt. Any e-commerce seller with total income above CHF 100,000 must VAT register in Switzerland to charge VAT to local B2C sales. However, the Federal Tax Administration has noted that there are still large amounts of evasion, and it has limited powers to enforce the rules.  This creates an unfair advantage for non-resident e-commerce sellers operating in Switzerland.

Ending low-value consignment relief

The Administration is therefore now consulting on ending the low-value VAT exemption, and imposing deemed supplier rules on marketplaces. This follows the EU’s e-commerce package reforms introduced in July 2021.

But how to calculate the CHF 5 value? VAT Calc’s in real-time global Calculator and Auditor  services produce instant and accurate tax calculations for the Swiss changes, as well are our Filer produce automatic VAT  returns from the shared transactions.

Read our Swiss VAT guide.

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