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Swiss Senate approves financing of extra month pension payment

Council of States approves financing of the 13th AHV pension
Council of States approves financing of the 13th AHV pension Keystone-SDA

The Swiss Senate has voted in favour of using value added tax (VAT) and salary contributions to finance the additional 13th month pension payment.

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Not only the financing of the additional month of the old-age and survivors’ (known as the AHV/AVS) pension was up for discussion, but also the abolition of the marriage penalty in the pension. In Switzerland, married couples receive a combined maximum pension, which is less than the total they could receive as unmarried individuals.

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The senate voted in favour on Thursday by 23 votes to 17 with one abstention. According to the decision, salary contributions to the pension are to be increased by 0.4 percentage points on January 1, 2028. If salary contributions to unemployment insurance were reduced by 0.2 percentage points at the same time, pension contributions for employers and employees could increase by 0.1 percentage points each.

At the same time, value added tax will be increased by up to one percentage point in two stages. The first increase of half a percentage point from 2028 will be used for the 13th month pension payment. The subsequent second increase will be used to finance the possible abolition or higher capping of pensions for married couples.

Translated from German by DeepL/jdp

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