Because Zurich is re-evaluating all properties, homeowners will have to brace themselves for significantly higher tax bills from 2027, cantonal authorities announced onTuesday.
This step was triggered by two court rulings, according to which many properties in the canton were undervalued. The last estimate took place in 2009, but real estate prices have soared by an estimated 50 percent since then.
Therefore, property tax values are to increase by an average of 48 percent, while imputed rental values for single-family homes will rise by an average of 11 percent and for apartments by 10 percent.
With this measure, the canton and municipalities can expect additional income of 85 million each.
What is the imputed rental value?
It is a tax term used to describe the theoretical rental value that you would have to pay if you were renting your own property.
In Switzerland, this value is used to calculate taxes, even if you live in your own apartment or house and do not pay rent.
For owner-occupied apartments in the canton of Zurich, the imputed rental value is 4.25 percent of the tax value. For single-family homes, it is 3.5 percent.
Authorities get ready for more ‘hardship’ cases
As a result of this tax hike, a larger number of hardship cases — that is, people who won’t be able to afford higher property taxes — the cantonal government is calling for the introduction of a ‘hardship regulation.’
Under this measure, a tax charge on the imputed rental value should be anchored in the law if it leads to an excessive tax burden in relation to the household income and assets.
The current cantonal hardship regulation serves as a transitional solution, which is in effect until legal basis is enacted at a federal level.
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