The deductions were indeed a logical consequence (?) of imputed rental value and they don’t make sense otherwise.
I don’t think dividends are taxed BECAUSE you can deduct portfolio management costs…
idk about that. I mean, I understand what you are saying - I think its called „Nettobesteuerung“.
But according to the document mentioned by @nabalzbhf imputed rental income was not mainly about income.
In contrary dividends are clearly income, thats why the costs to generate this income can be deducted.
Anyway, I am not a expert in this field and to me it is like a chicken or egg question. Doesnt matter to me what was first, but it males sense both exist.
I was just thinking about this removal. I wonder if they thought at all cases where they use the tax declaration income to provide benefits; for example the childcare tariff. If you are in a lower tax bracket, you will pay less for child care in certain cantons.
Now, imagine the situation: somebody inherited a almost paid for home, has a 80k income, a child in the Kita. And the second case lives in a rented apartment, has 80k income, again a child in the Kita.
The two situations are not identical; the second family needs to pay for rent and therefore needs the help with reduced rate more than the first family. Before the vote, the first family would see their income go up to 90k or something (imputed value minus deductions) and therefore pay more for the Kita.
After the vote, if they don’t change the system to determine tariff, subsidies like this will be distorted and distributed less fairly. What do you think?
Well, the whole point of EmW was to eliminate such distortions, so obviously abolishing it will bring the distortions back.
Now homeowners are able to live in their homes ‘tax-free’.
Well, they can live in their bank-owned home ‘tax-free’ 
I was overhearing colleagues talk today (the “perk” of RTO policies and open spaces), and one was talking about how they had given up on their plan to buy a “cheap” house to renovate after the vote. Their argument was that in VD, renovations have essentially increased by 50% in price, and it would be very difficult to find available workers in the next couple of years.
I wonder how the price of those houses will evolve. We’re talking about a substantial price decrease necessary to counter balance the increase in renovation costs. Probably enough that people would prefer to sit out for a while rather than eat a 6 figure “loss”. At the same time, they’re probably mostly owned by older people right now, and will end up in inheritance, which might push people towards selling anyway.
In Zurich City the Vermögen is being taken into account when calculating Kita prices. However the houseowner’s Vermögen only goes up 400k when he earns a 1M house meanwhile someone who inherits 1M ….
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Maybe renovate as a rental and then conveniently decide a few years later that actually you’d want to live in it.
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The tax values of homes are being reassessed, though, especially in ZH, if I remember correctly. So, the difference between tax value and market value may decrease in the near future.
If I remember correctly, that reassessment was postponed after the results of the vote on Eigenmietwert. Stocker/SVP are keenly aware whose interests they represent.
The law says that the Steuerwert shold be around 70 Prozent des Marktwerts, so it will never go anyehere close of 100 percent
I’ve scanned this full thread, but it’s not clear to me when the Eigenmietwert and renovation deductions removal will enter into force. Above it is indicated immediately, but does this mean tax year 2026, or 2025 already? Cantonal interpretations yet to be defined?
Do I have time to scramble some renovations before end 2025 to still benefit from the tax offset on renovation cost?
Timeline is not yet determined, there were some mentions that it will not be before 2028
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The reality is renovation of residences is a constant and huge part of our circle economy, so if the federation doesn’t bring back officially the tax offset for renovations there will be a huge increase for work done without an invoice or partial invoice where the only loser will be the federation which will not be able to recoup VAT and other state taxes connected with companies and their operations. I would be that even with the tax offset for renovation the state is net positive by giving back a tax offset but taking VAT and other taxes on the other side. Companies will find work, people will find their way to obtain a discount, the state won’t be able to cash in on these works.
People who buy old and renovate are usually people who are resourceful and find their way, so I expect there will be no change in the availabilities for older properties in the years to come. Might be even more expensive in the end as it will be more complicated and that will push prices up for new and old properties. People still need to live somewhere and as long we have more people coming here and we are not building enough, difficult to have a drastic change.
The way I see it.
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good point!
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Yes, you still have time. I talked to various professionals and it will not come into force until 1.1.2028, that’s the best guess so far.
Reason is, to allow the cantons to create the laws for the 2nd residence taxation, cantonal work deductions, etc.
Of course it might still be somewhat later…
Is this “huge increase” a given? I felt this was a kind of “propaganda” from the “Keep the EmW” side, I mean, we’re in Switzerland, the car garage owner never offered to do my car repairs for a few bucks less, if I didn’t “need the invoice”?
Seriously asking, maybe my car repairs were not enough to bother, maybe we didn’t know/trust each other well enough, etc.
Those with experience with construction companies/painters/electricians/etc, do you think they will become more “creative” in their billing options?
Would they then only have a 60% job “officially” and work 100%? Up to the extreme of having no job at all and doing everything on the “black market” while getting welfare assitance?
In my personal view if things stay like that the “work on the black” will only increase. With manual labor workers this is the most accented because material costs is very small percentage on the overall work, so they can be flexible for huge discounts if paid cash.
Say you have 10k wall painting job, material is 1500 at best, the rest is labor. If we focus on what he could hide, 8500 he needs to pay 8% VAT and probably around 20% tax. You on the other hand could save say 20% as well if you pay the full 10k now and wait couple of years for reimbursement.
Now, both of you come to an agreement for discount of 25% if paid in cash. He gets the same money like before, you get the same as before, only the tax man is left short.
With bigger companies and bigger jobs how it happens is only part of the cost is on invoice the rest is in cash. Say you have a new roof, 120k job. The company issues you a 60k invoice, you give them another 30k in cash. You both save.
Another thing what is done, there is a cap on how much tax you can offset in a year, so what you can do with a friendly company, say you have a year of renovations, they issue you few invoices and spread them through 3 years, say you plan to start in 2025, but the company makes you the invoice for December 2024, June 2025 and January 2026, so you claim to the max in each tax year.
It all depends on how you ask, you have people who are not interested and want nothing to do without invoice, you have a lot of small independents who would save few francs that way.
The way I ask it, in whatever situation, they tell me it would cost this much, I don’t question the sum, but I ask immediately “and how much without an invoice”? My quick math in the head tells me that sum should be -20 to -30% depending on how much material is included.
I once bought a garage door from a huge international company, they had a demo door for sale, already very discounted, the measurements were a perfect fit for me, I tried to haggle, they wouldn’t budge I finally said OK, give it to me without VAT, I don’t need the invoice and they accepted
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Thanks a lot for such a detailed reply / sharing your interesting insights @rew342343 .
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I think the deeper issue may come from general contractors or intermediaries (so probably for bigger renovations). They know the subcontractors they work with well and it’s easier for them to have an understanding.
Some small contractors may try to undercut their competition by working on the black market but I’d guess that depends on the actual contractor (some will/do, some won’t/don’t).
It still seems a relevant point and, I think, an actual risk. I wish I had thought about it before the vote happened.