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Changes to Swiss VAT ordinance
The Swiss Federal Council has announced a change to the VAT Ordinance aimed at maintaining competitve neutrality to foreign suppliers. Taxand Switzerland gives an overview of the amendments.
Based on the current VAT rules foreign suppliers of goods were not liable for VAT if they supplied goods, such as construction supplies, which were not subject to the import VAT. The reason for this was that such supplies were subject to the reverse-charge mechanism. This led to competitive distortions, especially in border regions as foreign suppliers could offer their supplies free of Swiss VAT, while most of the private individuals did not account for the reverse-charge mechanism.
The new rules intend to amend the existing VAT act in this regard as of 1 January 2015 and to oblige foreign suppliers to register for VAT if they supply goods locally. Foreign suppliers will have to register for VAT as of 1 January 2015.
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