Basel-Land moves up the location rankings

The top spots in the 2023 cantonal rankings are unchanged from last year: Zug is in first place, followed by the Canton of Basel-Stadt. Both cantons have a very attractive combination of factors to offer. The cantons of Zurich and Geneva follow in third and fourth place, respectively – also unchanged from last year.
Only four cantons changed position: Basel-Land saw the biggest improvement, pushing the Canton of Thurgau into 11th place. This follows a tax cut for legal entities and private individuals.

In the midfield, the Canton of Appenzell Ausserrhoden just managed to overtake the Canton of Obwalden and is in twelfth place. This was down to Appenzell Ausserrhoden's superior position versus Obwalden in terms of the availability of highly qualified workers as well as tax attractiveness for private individuals. With their challenging topography, the peripheral cantons of Valais and Jura continue to exhibit the lowest locational quality.

Overall, therefore, the rankings remained very stable in 2023, with only a slight change in the position of most cantons between 2014 and 2023.

Due to the significant improvement in tax appeal for legal entities, however, some cantons performed significantly better than ten years ago: For example, Basel-Stadt now competes with the first-placed Canton of Zug. In addition, the cantons of Geneva and Vaud have moved up twelve and five places, respectively. The Canton of Fribourg, meanwhile, has advanced by four places. Relative to other cantons, Bern and Obwalden lost the most appeal during the observation period, as reflected in a fall of five places in both cases.

The centers of Zurich, Zug, Basel, Baden, and Geneva, as well as their metropolitan areas, are among the most attractive regions for companies, thanks not least to their transport accessibility. Alpine regions and the regions of the Jura Arc are significantly less attractive to companies due to their topographical features and in some cases considerable distance to metropolitan areas.

The Upper and Lower Basel regions show the biggest improvement compared with last year, as reflected in advances of four and two places respectively. The Graubünden regions also improved slightly. In the Canton of Valais, the Visp region developed positively thanks to improvements in tax attractiveness for private individuals as well as the availability of skilled workers and highly qualified personnel. In the Canton of Ticino, the Mendrisio and Lugano regions offer the best locational quality – although they are down a few places in the regional rankings.

From 2024, international efforts to reform global corporate taxation are likely to partially restrict or even eliminate tax competition. For Switzerland, as a fiscally attractive location for international companies, the planned introduction of a global minimum tax rate of 15% is particularly relevant for internationally active companies with a turnover of EUR 750 million or more. For companies below the threshold of EUR 750 million, the existing rules remain valid.

The reductions in corporate taxes that have taken place over the last few years have already led to smaller differences in the tax burden for legal entities from canton to canton – which is also reducing the importance of corporate taxes in the ranking. The minimum tax rate is likely to intensify this trend. Other factors will in turn become more important: not least tax appeal for private individuals, access to qualified workers, and accessibility.

In response to international competition, it is important for Switzerland to preserve its traditional strengths – including political stability, high-quality infrastructure and educational institutions, along with healthy public finances.