Federal Council Releases Draft Bill On Tax Proposal 17

After the rejection of the IIIrd Corporate Tax Reform package through a popular referendum held in February 2017, the Federal Council finally released a revised legislative bill for a tax reform (the "Tax Proposal 17") on 21 March 2018, after a public consultation process was held.

Overall, the Tax Proposal 17 includes measures that are fairly similar to the previous version of the reform package that was rejected, with some modifications designed to achieve the buy-in from the majority of the Swiss populace. As the previous package, the Tax Proposal 17 would repeal the current privileged corporate tax regimes (holding, mixed and domiciliary or auxiliary companies, the finance branch regime and the principal company regime) and introduce some new measures designed to maintain Switzerland's competitiveness in the international tax arena (in particular, an OECD-conform patent box regime and a super-deduction for R&D expenses). However, the highly controversial notional