Switzerland may one day charge employers an “entry fee” for recruiting workers from the European Union. The idea, long dismissed as anti-business and potentially incompatible with the country’s agreements with Brussels, is gaining support in Parliament. The Federal Council now backs it too.
The proposal forms part of Parliament’s debate over Switzerland’s new package of agreements with the EU. It would not create a permanent immigration tax. Instead, the levy could be imposed only if immigration from the EU rose far enough for Switzerland to activate a new safeguard clause.
That clause is designed to give Switzerland more room to respond to unusually high immigration. The Federal Council would set thresholds for indicators including net immigration from the EU, the number of cross-border workers, unemployment and the share of people receiving social assistance. If those thresholds were breached, the government would have to decide whether to invoke the safeguard.
The government has already published provisional thresholds. Looking backwards, they would have been met eight times since the free movement of people with the EU came into force in 2002.
Until recently, debate over the safeguard clause focused mainly on quotas or measures giving Swiss residents preference in the labour market. The idea of an immigration levy emerged only during recent parliamentary committee discussions.
Its logic is straightforward. By making it more expensive to recruit workers from abroad, the levy would encourage firms to look harder for employees already in Switzerland. Employers would bear the cost for newly arriving workers.
Under the proposal, companies would pay at least CHF 4,000 for every employee recruited from abroad. Self-employed immigrants would pay the levy themselves. Adult family members arriving through family reunification could face a charge of at least CHF 2,000.
There are, however, several hurdles before any such charge could be imposed. First, the new agreements with the EU would have to enter into force. Second, Switzerland would have to activate the safeguard clause. The EU could challenge that decision, in which case an arbitration tribunal would rule on whether Switzerland had met the agreed conditions.
Even an adverse ruling would not necessarily stop Switzerland from acting. The government could still invoke the safeguard clause, but the EU would then have greater scope to retaliate. Countermeasures could affect agreements covering the free movement of people, air and land transport, and technical barriers to trade. Agriculture has been explicitly excluded.
Brussels would not have a free hand. Any countermeasures would have to be proportionate, and Switzerland could challenge them before an arbitration tribunal.
The Federal Council argues that an immigration levy could in principle be compatible with the safeguard clause. In a report published in May, it said such a charge would be legally possible, though exemptions might be needed in some cases, particularly for family members. Last week it recommended that Parliament approve two related proposals from the Council of States.
Whether the EU would accept such a measure politically is another matter.
Business groups are wary. The Swiss Employers’ Association argues that the levy would raise labour costs and impose additional bureaucracy.
The Council of States is due to vote on the proposal during its forthcoming debate on the EU package. Its prospects appear reasonably strong: both the State Political Institutions Committee and the Foreign Affairs Committee have backed the idea, though the latter did so more narrowly.
The political attraction is obvious. The levy promises a way to curb immigration without imposing outright quotas, while generating revenue that could be redistributed to residents. But it would also make foreign recruitment more expensive and could provoke a fresh dispute with Brussels. That trade-off is likely to define the debate.
More on this:
Parliamentary source (in French) – Take a 5 minute French test now
For more stories like this on Switzerland follow us on Facebook and Twitter.