Switzerland is a diverse and mature economy, and offers a great opportunity for UK-based businesses – bilateral trade between the two countries is worth £31.9 billion, and Switzerland is the UK’s tenth largest export market, with goods and services exports having grown by 130% in the last five years.
If this sounds like a good opportunity for your business, here’s everything you need to know about exporting to Switzerland.
Where is Switzerland?
Switzerland is a landlocked country in central Europe, bordered by Germany to the north, Austria and Lichtenstein to the east, Italy to the south and France to the west.
Bern is the capital city, and is just over 1600 miles from London, with regular flights available from all over the UK.
There are four official languages – French, Italian, German and Romansh – is Spanish, the currency is the Swiss franc, the dialling code is +41, and the top level domain for websites is .ch
What are the pros and cons of exporting to Switzerland?
Although Switzerland isn’t a member of the EU doing business there should be similar to doing business in the UK, there are some unique challenges:
- EU standards are not always adopted
- domestic rules and regulations apply
- highly regulated market
- difficult to ensure local legal compliance for certain industries and ‘posted workers’ (employee normally working in the UK, but temporarily working in Switzerland)
- slow decision-making because of the need for consensus and a reluctance to take risks
- Swiss consumers places a premium on quality
Regardless of these challenges, there are plenty of benefits to doing businesses in Switzerland, including:
- favourable exchange rate
- location – flight times under 2 hours, Switzerland based in central Europe
- English widely spoken
- multicultural market suitable for product testing
- Europe’s highest per capita income
- similar legal and regulatory environment
- political and financial stability
- high productivity
- excellent public infrastructure
- highly educated workforce
- innovative country
- purchasing power amongst the world’s highest
- high spend on research and development (R&D) and technology
- reliable business, legal and regulatory environment
- low Value Added Tax (VAT) compared to many European Union (EU) countries
And to give your business the best chance of doing well out there, it’s worth noting the strengths of the Swiss market include:
- central location in Europe
- political and financial stability
- excellent public infrastructure
- highly educated workforce
- high productivity
- innovative country with high spend on research and development (R&D) and technology
- purchasing power amongst the world’s highest
- reliable business, legal and regulatory environment
- low Value Added Tax (VAT) compared to many European Union (EU) countries
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How does tax work in Switzerland?
The main tax rates in Switzerland are:
- VAT – Switzerland has a standard VAT rate of 7.7%. It has a reduced rate of 3.8% for hotels, and a further reduced rate of 2.5% for foodstuffs, water and books.
- Corporation tax – charged at 8.5%
It’s also worth noting that the country is made up of 26 member states, known as Cantons, and each is free to decide on their own tax systems and tax rates. They have the power to charge any tax that the Swiss Confederation does not claim exclusive rights over. This means that the tax laws and tax rates vary widely from canton to canton.
How will I be affected by customs in Switzerland?
All imported good are regulated by the Swiss Customs Administration, and duty rates depend upon a number of factors, including the type of goods and services and the country of origin. All imported goods and services must be cleared with customs. For more information, go to https://www.ezv.admin.ch/ezv/de/home/zollanmeldung.html
