This approach makes for light regulation from the top. The Federal Council, the federal government\u2019s executive branch, does without recognisable figureheads. The cabinet has seven members who have equal power and each of whom spends a year as president, ensuring that no one remembers their names for long. While the council has few powers the country\u2019s 26 cantons have plenty, as do its more than 2,000 municipalities. Cantons run health care, welfare, education, law enforcement and fiscal policy. That allows them to compete to be attractive to businesses and their workers. Lucerne halved its corporate tax rate in 2012 to do just that. Zug has the lowest corporate tax rate at 11.9%. Only \u201coffshore\u201d financial centres such as Guernsey and Qatar have lower tax rates than those levied in the low-tax cantons, states a report by kpmg, an accounting firm. Compare that with France where the rate is 26.5%.<\/p>\n
The competition doesn\u2019t stop at light taxation. Cantons help to fund top-notch universities. Zurich\u2019s Eidgen\u00f6ssische Technische Hochschule (eth), one of the two federal institutes of technology, is regularly ranked among the best universities in continental Europe. Strong links between business and academia mean that graduates have the right skills. For instance, in January 2020 Nestl\u00e9, the Ecole Polytechnique F\u00e9d\u00e9rale de Lausanne (epfl), another federal institute of technology, the canton of Vaud and the Swiss Hospitality Management School in Lausanne launched the \u201cSwiss Food Nutrition Valley\u201d, a research programme to promote innovation in sustainable food production. Logitech, a maker of software, and Cisco, a technology firm, have research centres on the epfl campus.<\/p>\n
Yet for all its success Switzerland has become less attractive as a hub for multinationals over the past three decades. In 1990 two-thirds of America\u2019s top 20 companies (including General Motors, Hewlett-Packard and ibm) had their European headquarters in Switzerland. In 1992 Swiss voters decided against following the Norwegian example and joining the European Economic Area with access to the eu\u2019s single market. As a consequence some of the world\u2019s most successful companies, such as Amazon, Alibaba and Samsung, decamped to Amsterdam, Dublin and London. Last year Switzerland missed another chance to gain smooth access to one of the world\u2019s largest markets when it failed to convert 120 bilateral deals into an overarching treaty with the eu.<\/p>\n
Read it all<\/a>.<\/p>\n Switzerland has prospered as a haven for businesses far beyond what might be expected of a small, landlocked country with scant natural resources. We explain why https:\/\/t.co\/JIN20yGVl6<\/a><\/p>\n — The Economist (@TheEconomist) May 24, 2022<\/a><\/p><\/blockquote>\n \n