Federal Council adopts dispatch on new frontier workers agreement with Italy

Press releases, 11.08.2021

During its meeting on 11 August 2021, the Federal Council adopted the dispatch on the new frontier workers agreement between Switzerland and Italy. The agreement significantly improves the current regulation on the taxation of frontier workers and contributes to maintaining the good bilateral relations between the two countries.

The new agreement was signed in December 2020. After year-long negotiations, it was possible to find a solution that was satisfactory for both sides.

With the new agreement, Switzerland retains 80% of the regular withholding tax on the income of frontier workers who start working in Switzerland for the first time. New frontier workers will also be taxed normally in Italy, whereby double taxation will be eliminated. "New" frontier workers are individuals who enter the labour market on or after the date on which the agreement enters into force.

A transitional provision applies to persons who work or have worked in the cantons of Graubünden, Ticino or Valais between 31 December 2018 and the date of entry into force of the new agreement. These frontier workers will continue to be taxed exclusively in Switzerland, with Switzerland paying the Italian border communes financial compensation in the amount of 40% of the withholding tax levied in Switzerland. This will be paid until the end of fiscal year 2033.

Botschaft(pdf, 670kb)
Bundesbeschluss(pdf, 322kb)
Abkommen(pdf, 431kb)
Protokoll(pdf, 391kb)

Address for enquiries:

State Secretariat for International Finance SIF
Tel. +41 58 462 46 16, info@sif.admin.ch


The Federal Council
Federal Department of Finance