Special: Swiss tax reform STAF: R&D Instruments 2025
STAF R&D Instruments
With the Swiss tax reform STAF (or TRAF), tax incentives for research and development activities (STAF R&D instruments) were introduced at the beginning of 2020. These internationally accepted tax instruments serve to promote innovation activity. The BAK Taxation Index project investigated the impact of the STAF R&D instruments on the EATR (i.e., the effective average tax rate) for companies. The reference year chosen for the calculations was 2025, when all cantons will have fully implemented their STAF implementation plans. The analysis is based on the cantonal plans as of March 2020.
EATR when using the STAF R&D Instruments 2025
The STAF R&D instruments significantly reduce the tax burden for research-intensive companies in the Swiss cantons. At the same time, the flexible implementation in the cantons changes the Swiss ranking. Even though the ranking for research-intensive companies is led by Central and Eastern Switzerland, cantons with important research clusters such as Bern, Zurich and Aargau (which traditionally belong to the high-tax cantons) make up several ranks.
The BAK Taxation Index for companies measures the effective average tax rate (EATR) for companies in all 26 cantons and their main international competitor locations. It includes all types of taxes and regulations relevant to investors at the various levels of government.
The BAK Research Intensive Companies module is a model developed within the Project BAK Taxation Index to calculate the effective average tax rate (EATR) when using the newly introduced STAF (or TRAF) R&D instruments (patent box, R&D deduction, incl. relief limitation). The main difference to the standard model of the BAK Taxation Index is that not an acquired but a self-created intangible asset (patent) is assumed. The tax burden when using the STAF R&D instruments was calculated for three different types of investments or companies, which differ in their research intensity: