From January 1, 2025, residents of Switzerland will be subject to harsher restrictions on cross-border shopping. The VAT-free limit on goods brought in from Germany, Italy, France and Austria will be halved, the Federal Council has confirmed.

Cross-border shopping in Switzerland

It’s a well-known practice among people living in Switzerland: because goods are much cheaper in Germany, France and Italy, many people take advantage of the lower prices and do their grocery, clothes and other shopping abroad. This has been accelerated by the strength of the franc compared to the euro, and how high Swiss salaries are compared to neighbouring countries.

What’s more, shoppers can import goods back into Switzerland without having to pay import duties or value-added tax, so long as their total value does not exceed 300 francs per person. There are also some restrictions on the volume of certain items like beverages with an alcohol content of less than 18 percent (5 litres per person per day), drinks with more than 18 percent alcohol (1 litre per person per day), meat (1 kilogram per person per day) and cigarettes (250 cigarettes per person per day).

While good for shoppers, the practice leaves local stores and supermarkets in Switzerland out of pocket, especially in areas close to the border. In August, the Swiss Retail Federation reported that people in Switzerland spent 8,5 billion francs in Germany and France in 2023, predicting “a loss of Swiss retail revenue of more than 10 billion francs due to shopping tourism” for 2024.

VAT-free limit on Swiss shopping tourism to halve

However, from January 1, 2025, people in Switzerland will see the tax-free limit on cross-border shopping cut from 300 to 150 francs per person. Writing in a statement, the Federal Council said that the cuts were in response to a federal proposal submitted in August and demands submitted by two Swiss cantons (Thurgau and St. Gallen).

Under the new rules, if the items brought into Switzerland exceed a total value of 150 francs per person, they must be reported to customs authorities directly or via the QucikZoll app. Shoppers will also have to pay Swiss VAT - the tax amounts to 8,1 percent on most goods, alongside a 2,6 percent reduced rate for certain items like foodstuffs, water, and books. However, you are currently unable to claim the lower rate via the QuickZoll app.

In the statement, the government argued that their proposal pursues the “common goal of improving tax fairness and counteracting shopping tourism.” They added that halving the limit was a compromise, as cutting it even further would lead to disproportionate enforcement costs for the police and customs officers and major travel disruption for drivers crossing the border.

Swiss consumer associations unsure what impact the measures will have

While welcomed by cantonal and business representatives, the compromise has not found approval everywhere. Sara Stadler from the Swiss Consumer Protection Agency told 20 Minuten that she doubted the plan would reduce shopping tourism. "People will find ways to get around the measure," she argued, noting that the lower limit will simply necessitate more trips across the border rather than fewer.

On the opposite side of the argument, the Swiss Retail Federation maintained that the current tax-free system is unfair to entrepreneurs. Speaking to 20 Minuten, director Dagmar Jenni said that the fact that cross-border shoppers don’t pay value-added tax is unjust to those who get their necessities exclusively in Switzerland. 

The association reiterated its demand to lower the VAT-free limit to 50 Swiss francs per person.

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