SWITZERLAND shot down the government’s plan to reform corporate taxation, a decision that risks hurting its appeal as a place for multinational firms.

    After opponents labeled the reform a series of “complicated tax tricks,” voters opposed it by 59 percent to 41 percent, the federal chancellery said Sunday. Polls had suggested the electorate was evenly split on the measure, which would have given companies reductions for income from patents and research and development activities.

    Due to international pressure, Switzerland needs to give up special breaks for multinationals, which generate billions in tax revenue and employ some 150,000 people in the country of 8 million. To stay attractive, the plan included cantons cutting the rates they charge companies across the board. Voters feared this would have strained the public purse and increased the burden on individual taxpayers.

    The plebiscite is the latest decision that risks damaging the economy in Switzerland, which is one the world’s most affluent countries and regularly tops the World Economic Forum’s global competitiveness index.

    Following an international crackdown on banking secrecy, stringent limits on executive pay were introduced in 2013 and, the following year, a referendum on immigration quotas threatened to undermine ties with the European Union.

    Multinationals generated around 12 percent of economic output and 9 percent of employment in 2015, according to consultancy BAK Basel.

    Opponents of the reform, notably the Social Democrats, the second-biggest party in parliament, argued the reform would mean more than 2.7 billion francs (US$2.7 billion) in lost tax revenue. They called Sunday’s result a “red card” for the “arrogance” of the right. While conceding it would pressure budgets, proponents of the reform, notably businesses and the government, had argued it was the least costly option to keep Switzerland internationally competitive. (SD-Agencies)