In its session of 7 March 2018, the Council of States adopted the Federal Act on the Tax Treatment of Financial Sanctions.
According to the business of the Federal Council (16.076) "Federal Law on the Tax Treatment of Financial Sanctions", Swiss companies should not be able to deduct from taxes fines imposed on them abroad.
With its dispatch on the Federal Act on the Tax Treatment of Financial Sanctions, the Federal Council is implementing the Luginbühl motion "Tax deductibility of fines" (14.3450). The motion calls for an explicit legal regulation of the tax treatment of fines and other financial sanctions with a punitive purpose for companies. In contrast to profit levies without a punitive purpose, these expenses should not be tax deductible. These objectives will be achieved by amending the DBG and the StHG.
The Council of States (first chamber) approved the Federal Council's draft in its meeting on 7 March 2018 by 30 votes to 6 (with 5 abstentions). The majority of the Economic Commission of the Council of States, on the other hand, wanted to make foreign fines, penalties and financial administrative sanctions deductible, but this recommendation was clearly defeated in the vote (see also the SDA's press release of 7 March 2018).
The minutes of the Council of States are available here.
