Until recently, Swiss residents who lived in the homes they owned were taxed as if they were earning rent from themselves under the country’s imputed rental-value tax.
The idea was to treat owner-occupiers and renters equally under the tax code, with the former needing to account for the benefit of living rent-free in their home. It may sound bizarre, but it isn’t any more irrational than the US mortgage-interest deduction.
The US approach, however, is basically the opposite of what Switzerland was doing. We reward homeownership and peg the size of that reward to the size and rate of the mortgage undertaken to acquire the home—the more interest you pay, the more benefit you receive. Renters, of course, get nothing.
The Swiss approach was built on the economic principle of tax neutrality. It treated the implicit rental benefit of owner-occupied housing as income and allowed mortgage interest deductions only as an offset to that hypothetical income.
Voters decided last month to abolish the tax. This will simplify filing and ease burdens on homeowners, but it also erases a powerful tool for achieving tax equity.
The US hasn’t seriously considered something similar, which tells you everything you need to know about our housing policy priorities. We want to encourage homeownership, full-stop—and we don’t mind placing renters at an economic disadvantage to do so.
Subsidizing homeowners simply because they borrowed money to purchase their home isn’t sound policy, though. We should consider offsetting that deduction with imputed income. If the Swiss are done with tax neutrality, maybe we can take it off their hands.
—Andrew Leahey
Welcome to the Week in Insights for Bloomberg Tax’s latest analysis and news commentary. This week, experts examined the demise of Pittsburgh’s “jock tax,” tax considerations for cross-border families, and more.
The Exchange—It’s where great ideas on tax and accounting intersect.
Insights
Cross-Border Couples Must Learn to Navigate Tax Planning Traps
Cross-border spouses have several different options to lower their tax burdens without running afoul of US and state tax laws.
What Really Counts as Qualified Appraisal and Adequate Disclosure
Adequate disclosure can help start the statute of limitations on gift tax and avoid potential valuation-related penalties.
Trump ‘Baby Bonds’ Lack Potential to Fix Generational Wealth Gap
The Trump Accounts and updated federal child tax credit are unlikely to make a substantial impact for low-income households.
Senate Report on SVB Fails to Recognize Accounting Illiteracy
A Senate report about KPMG’s role in Silicon Valley Bank’s collapse, as well as statements by JPMorgan Chase CEO Jamie Dimon, reflect a misunderstanding of what accounting is designed to do—and what it already revealed.
Trump Tax Law Erases Economic, Racial Progress in the Tax Code
President Donald Trump’s massive tax-and-spending package will leave a costly hole in the federal budget for future multiracial generations.
Crypto Becomes Emerging Asset Class for Institutional Investors
Crypto is becoming an additional asset class for institutional investors and continuing to establish itself as a core component of global investment strategies.
Pittsburgh’s Loss of ‘Jock Tax’ Forces Fairer Play by Localities
The Pennsylvania Supreme Court’s decision to nix Pittsburgh’s “jock tax” sends a clear message to state and local taxing jurisdictions: When crafting a tax, make sure it hits nonresident and resident athletes equally.
Canada’s Voluntary Disclosure Reforms Are Helpful, if Imperfect
Canada’s reforms to its voluntary disclosure program should benefit taxpayers, though some problems such as lookback periods and disqualification through audits or investigations remain unresolved.
State Conformity to Federal Tax Law Should Be Careful, Tailored
State policymakers should delay conformity to the federal fiscal package’s tax changes or create transition rules to provide relief for taxpayers.
When Transfer Pricing Meets VAT, an Uneasy Relationship Results
The interaction of transfer pricing with value-added tax is a persistent source of complexity for multinational groups and a growing focus for European tax authorities, and recent judgments are reshaping the boundaries of this uneasy relationship.
Columnist Corner
Shifting toward tariffs and away from taxes will increase the bureaucracy necessary for enforcement more than it will protect domestic production, Andrew Leahey argues in his latest Technically Speaking column.
“Tariffs’ economic incidence may turn less on corporate patriotism and more on who can afford better legal and lobbying teams,” Andrew writes, adding that restoring tariff authority to Congress would make trade policy more predictable and legitimate. Read More
News Roundup
3M’s Transfer Pricing Win Marks Tax Code Interpretation Upheaval
Filing Taxes Free at IRS Will Change Again, Explained
Lawmakers and the IRS have long grappled with how to offer free, online tax filing—and what the role of tax preparation software companies should be.
EU Proposes Tax Breaks to Boost Savings and Investment
The European Commission on Tuesday proposed a mix of tax exemptions, deferrals and simplifications to encourage citizens to open savings and investment accounts.
Crypto Titan’s Move to Puerto Rico Spurs Wyden Tax Evasion Probe
The founder of $5 billion cryptocurrency hedge fund Pantera Capital is in the crosshairs of US Senate investigators, who allege he may have evaded more than $100 million in capital gains taxes after seeking tax refuge in Puerto Rico.
Tax Management International Journal
Tariffs Test MNEs’ Transfer Pricing Global Operating Models
An economist presents real-world examples of how tariffs and transfer pricing collide.
Tax Management Memorandum
SECURE 2.0 Act Reshapes Puerto Rico Retirement Savings Rules
In light of recent Puerto Rico and IRS guidance, some practical considerations on how the SECURE 2.0 Act changes to the Puerto Rico qualified retirement plan rules are analyzed.
PLRs Reveal Pointers for Fixing Inadvertent §2632 Elections
Postseason baseball is a metaphor for practitioners seeking relief for a late allocation or election under §2642(g)(1).
Career Moves
Withers Names Tax Partner Ceri Vokes as Next CEO as of July 2026
Withers on Monday announced the appointment of Ceri Vokes as its new chief executive officer, a role she will formally take on July 1, 2026.
Morgan Lewis Re-Hires Ex-Family Office GC for Private Clients
John Boxer re-joined Morgan Lewis as a partner in its private client group in Boston and Philadelphia, the firm announced Wednesday.
Venable Grows Chicago Wealth Planning Practice With David Berek
David Berek joined Venable as a partner in its private wealth planning practice in Chicago, the firm announced Wednesday.
Willkie Re-Hires Private Wealth Partner Wunderli at LA Office
Kathy Wunderli rejoined Willkie Farr & Gallagher as a partner in its private wealth group in Los Angeles, the firm announced Wednesday.
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