Individual taxation – A fair and balanced reform?

On 8 March 2026, Swiss citizens will vote on the introduction of individual taxation at the federal level. This reform aims to eliminate a tax inequality between married and unmarried couples, but it could also lead to new disparities and significant administrative consequences. Here are the key issues, advantages, and disadvantages of this change in system.

Individual taxation: towards tax equality between married and unmarried couples?

On 8 March, the Swiss people will vote on the Federal Act on Individual Taxation, which was adopted by Parliament on 20 June 2025 as an indirect counter-proposal to the «For Civil-Status-Independent Individual Taxation» initiative. The aim is to eliminate a fiscal inequality between married and unmarried couples within the direct federal tax (DFT). The proposal is divisive: it would benefit many, but would also create losers and additional costs for the cantons.

Current situation and change of system submitted for a vote

Currently, married couples file a joint tax return and are taxed jointly, while unmarried couples are taxed separately. The income and assets of married couples are therefore added together to determine their tax burden. Due to the progressive tax rate, some married couples are taxed more heavily than an unmarried couple in a similar economic situation. To date, this unequal treatment is particularly observed at the level of federal direct tax (FDT) and to a lesser extent at the cantonal and communal tax (CCT) level. Indeed, most cantons have already implemented measures to mitigate this inequality (full or partial splitting).

The Federal Law on Individual Taxation thus aims to eliminate this unequal treatment at the level of the AGI by taxing married couples separately. They would then have to prepare a tax return per spouse.

The new law would come into effect by 2032 at the latest. Tax relief for taxpayers is estimated at around CHF 630 million at the federal direct tax level.

Politically, most parties support this law. The UDC and The Centre reject this reform.

Arguments in favour of individual taxation

By taxing married couples separately, they should no longer suffer this fiscal injustice compared to unmarried couples. We note that this change in the taxation system should primarily benefit married couples where the spouses have more or less identical income levels.

For supporters of the reform, it would also encourage certain married taxpayers, who have chosen to stop working or to work at a reduced rate (for tax reasons), to increase their employment rate. The Swiss economy and social insurance would benefit from this. This could also guarantee greater financial independence and provision for old age for these taxpayers.

Arguments against individual taxation

Although individual taxation may be favourable for a good number of married couples, it has the following disadvantages:

• Creation of new inequalities: married couples with a single income, or where spouses' incomes diverge significantly, would see their tax burden increase with individual taxation
• Single high-income taxpayers would pay more tax
• The administrative burden for married couples would increase as they would have to file two declarations each year.
• According to estimates, cantonal tax administrations are expected to process approximately 1.7 million more tax returns per year. The cantons would then be forced to hire staff. It can therefore be feared that these additional costs will be passed on to all taxpayers.

Conclusion

On 8 March, the Swiss will therefore have to make a decision on a major change to the individual taxation system. Although this bill would remove unequal treatment experienced by some married couples, opponents argue that it would have disadvantages.

Will a «yes» on March 8th truly signify the end of debates on taxing married couples?

The question and debates surrounding the taxation of married couples will not, at first glance, end this Sunday on voting day. Indeed, we will also be asked to vote, possibly in 2027, on the popular initiative «Yes to fair federal taxes for married couples». This text aims to enshrine the principle of common taxation at the federal direct tax level in the federal constitution.

This initiative further calls for two distinct tax calculations to be carried out as part of a taxation process: one calculation under the current system (joint taxation) and an alternative calculation based on the tax bands and deductions applicable to unmarried individuals. Married couples would be taxed according to whichever calculation is most advantageous for them.