Switzerland’s parliament wants to scrap Switzerland’s quirky taxable imputed rental on owner-occupied homes. A vote on 28 September 2025 to impose a new tax on holiday homes is the first step to scrapping this taxable fictional rent.
But there is a catch: the change would end most deductions for mortgage interest, home maintenance and environmental upgrades—except for work on protected buildings. That has drawn fire from a broad business alliance calling itself “No to the Renovation Stop”, which includes the PLR/FDP, the Centre Party, and trade groups such as AEESuisse, Bauenschweiz, Suissetec and Swisscleantech, reported SRF.
Critics say the measure would blunt incentives to decarbonise Switzerland’s housing stock. Without tax breaks for renovations, investments in environmental improvements to buildings will fall, warned one expert. The result, he argued, would be slower progress towards the legally mandated net-zero target for 2050. Lisa Mazzone, leader of the Green Party, called the plan a dead end for climate policy. Property owners may choose simply to pay down mortgages rather than upgrade heating systems or improve insulation, said Cristina Schaffner of Bauenschweiz.
Others fear it will fuel undeclared work, estimated at half a billion francs a year.
In addition, the fiscal impact of any change is uncertain. With today’s low interest rates, the reform would cut revenues for all levels of government by around CHF 1.8 billion. But if mortgage rates rose above 3%, the new regime would yield more tax instead of less.
A recent poll suggests the vote will pass. 58% said they will definitely (37%) or likely (21%) vote in favour of the change on 28 September 2025.
More on this:
SRF article (in German)
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