Swiss parties push back against proposed VAT hike to fund military spending

The Swiss government proposal to raise value-added tax to help finance higher military spending has met broad political resistance, with most major parties opposing the plan despite growing security concerns in Europe.

A consultation process that ended Saturday found only the Centre Party fully backing the government’s proposal to increase VAT by 0.8 percentage points for 10 years starting in 2028, SWI reported on Sunday.

The Swiss government says the measure is needed to strengthen national defense amid a deteriorating security environment, warning that Russia could be capable of launching a major attack on Europe through Ukraine as early as 2028.

Officials also cite concerns about a weakening NATO security umbrella, even though Switzerland is not a member of the alliance.

The center-right Radical-Liberal Party supports creating a defense fund but rejects financing it through a higher VAT. The right-wing People’s Party favors reallocating existing funds, while the Greens oppose increasing military spending altogether. The Social Democrats have also rejected the VAT hike and called for alternative funding options.

Any VAT increase would require approval by parliament and Swiss voters under the country’s system of direct democracy.