6 INCOME TAXEs
6.1 SWISS TAX REFORM
On May 19, 2019, the Swiss electorate passed the Federal Act on Tax Reform and AHV Financing (TRAF). The tax reform abolishes the tax regimes for holding, domiciliary and mixed companies as of January 1, 2020, and introduces new tax calculation principles. As part of the TRAF and cantonal tax practice, transitional measures were introduced to ease the transition from the current reliefs to the new tax calculation principles. For the Group, these measures allow amongst others the tax-effective amortization of a step-up amount over a period of up to 10 years. Therefore, the Group started to capitalize corresponding deferred tax assets in 2019.
Deferred tax assets capitalized in connection with the step-up amount:
| 2024 | 2025 |
CHF 1,000 |
|
|
Balance at January 1 | 32,346 | 24,597 |
Write-off deferred tax asset for corresponding tax benefits received in current period and revaluation of deferred tax assets for tax benefits in future periods | (3,440) | (2,181) |
|
|
|
Balance at June 30 | 28,906 | 22,416 |
The calculation of the deferred tax assets related to the Swiss tax reform required management to make significant estimates and assumptions. The outcome is still uncertain and might lead to adjustments in future years.
6.2 OECD’S BASE EROSION AND PROFiT SHIFTING (BEPS) – PILLAR TWO
The OECD Pillar Two framework aims to ensure that multinational corporations pay a minimum effective tax rate of 15 percent on a jurisdictional basis. In Switzerland, the jurisdiction in which the ultimate parent company is tax-resident, a gradual implementation of Pillar Two took place with the introduction of a Qualifying Domestic Top-up Tax effective from 1 January 2024 as well as the Income Inclusion Rule (IIR) effective from 1 January 2025.
The Group has reviewed its corporate structure in light of the enactment of the Pillar Two global minimum tax rules in Switzerland and other jurisdictions in which it operates.
Based on the country-by-country reporting and the corporate tax expenses of group entities that are expected in 2025 and future years, we do not expect any impact that is material to our income tax charge and cash flows. Consequently, for the six months reporting ended 30 June 2025 the Group did not recognize a current tax expense related to the top-up tax.