Swiss voters to decide on VAT rise for 13th AHV pension
Friday 23rd October 2026 on 19:30 in
Switzerland
Swiss voters will decide on November 29 whether to raise value-added tax to help fund the 13th AHV pension, SRF reports. The proposal requires approval from both a majority of voters and a majority of cantons because it would amend the constitution.
The vote follows voters’ approval of the 13th pension in March 2024. Parliament agreed in June to cover part of its cost through a 0.4 percentage-point increase in VAT. The federal government estimates the change would generate about 1.4 billion francs a year from 2029, helping reduce the annual deficits created by the additional pension payment.
What would change
The standard VAT rate would rise from 8.1 per cent to 8.5 per cent. If approved, the increase could take effect no earlier than the start of 2028, with the timing to be set by the Federal Council. The hotel rate would rise from 3.8 per cent to 4 per cent. The reduced rate of 2.6 per cent on certain everyday goods, including food and medicines, would remain unchanged.
The Federal Tax Administration estimates the increase would add an average of about 180 francs a year to household costs. The first 13th pension payment is scheduled for December 2026 and will be paid from the AHV fund regardless of the vote, without the additional financing.
Arguments on both sides
Supporters say the VAT increase would spread the cost across generations, including pensioners, while leaving the reduced rate on some essential goods unchanged. They argue that the decision to introduce a 13th pension must be implemented and its funding secured.
Opponents say the AHV’s funding shortfalls should be addressed through structural reforms rather than taxes and levies. They argue that VAT weighs more heavily on lower-income households relative to their available income, and that higher prices could weaken consumer demand and put pressure on businesses and small and medium-sized companies.
The Federal Council and Parliament support the proposal. The National Council approved it by 108 votes to 85, with six abstentions; the Council of States voted in favour by 28 to 13, with three abstentions.