Friday, 24 June 2016
Last updated 13 min ago
Apr 17 2007 | 9:55am ET
Concerned by London’s dominance of the European hedge fund industry, Swiss officials are considering a dramatic tax cut to make their country more alluring to hedge fund managers.
The Swiss banking federation has proposed a 10% tax rate for top hedge funds, The Telegraph reports, and Swiss Finance Minister Hans-Rudolf Merz says he is considering the move.
Hedge fund managers are currently subject to a marginal tax rate of approximately 45%.
“It’s an idea I’m carrying around,” Merz, who has been meeting with leaders of the Swiss financial community, said. “The financial marketplace is of enormous importance to our country. I know that we have a disadvantage in taxes. We understand the problem, and we have to solve it.”
But Merz added it was unrealistic to expect Switzerland to supersede London—home to 80% of Europe’s hedge fund assets—saying London is “too strong” for a “frontal attack.” Instead, he told Bloomberg News, “It’s absolutely vital that there’s a certain competition.”