Zurich, Swiss voters delivered a resounding defeat to a radical wealth-redistribution initiative on Sunday, with more than 78 per cent rejecting a proposal to impose a 50 per cent federal inheritance and gift tax on fortunes above an undisclosed threshold.
The referendum, initiated by the youth wing of the Social Democratic Party (JUSO) under the banner “Live better — fund the future”, would have levied the tax on inheritances and large gifts transferred to grandchildren or non-direct descendants. Revenue was earmarked primarily for climate-protection projects and a reduction in health-insurance premiums.
The result represents one of the heaviest defeats for a popular initiative in recent Swiss history and underscores the country’s deep-seated resistance to measures perceived as threatening its low-tax, wealth-friendly model.
Campaigners argued that a small minority of ultra-wealthy families were passing on billions untaxed across generations while younger Swiss faced rising living costs, housing shortages and climate risks. Despite polling showing widespread concern about inequality, voters proved unwilling to endorse what opponents successfully framed as punitive confiscation of private assets.
Business federations, the banking sector and the federal government had warned that the tax would trigger capital flight, undermine Switzerland’s competitiveness as a wealth-management centre and ultimately reduce overall tax revenue — arguments that appear to have carried decisive weight.
The Swiss system of direct democracy already allows cantons to set their own inheritance tax rates; most apply modest or zero rates for direct descendants, making the country one of Europe’s most favourable jurisdictions for intergenerational wealth transfer.
Sunday’s outcome will be watched closely beyond the Alps. In India, opposition leader Rahul Gandhi’s high-profile 2024 election pledge to transfer ₹1 lakh annually to poor women — colloquially dubbed the “khatakhat” (instant deposit) scheme — has been likened by critics to similar redistributive logic. Indian commentators on the right were quick to portray the Swiss result as evidence that voters, even in one of the world’s wealthiest nations, reject aggressive wealth taxes when put to the test.
The Federal Council and a broad parliamentary majority had recommended rejection of the initiative. Final nationwide results released by the chancellery on Sunday evening confirmed a turnout of approximately 58 per cent, with every canton recording a “no” majority.
JUSO leaders conceded defeat but insisted the campaign had succeeded in placing intergenerational fairness on the political agenda. Analysts, however, expect little immediate momentum for alternative wealth-tax proposals at federal level.
Switzerland’s status as a global hub for private banking and family offices — managing an estimated $8tn in assets — remains intact for now.
