For those unfamiliar with this "rental tax": If you own a house in Switzerland, the tax office assumes that you are your own landlord and rent your house to yourself. It estimates the rent you charge yourself, and you have to pay income tax on it.
What makes this tax even stranger: as you are your own landlord, your property interest rate becomes a business expense of your hypothetical rental company. So basically you can deduct your property interest from this income tax on the hypothetical rent you pay yourself. In effect, it is unattractive to repay your mortgage, and private debt in Switzerland is one of the highest in the world.
A sad development. At least in the US, the fact that rent is taxable income to the landlord but imputed rent is untaxed is a regressive tax break for property owners (and was apparently a mistake of the original Form 1040; see Lawrence Zelenak, “The Early Income Tax and the Imputed Rental Income of Homeowners” https://doi.org/10.1017/9781108377157.008). I wonder what convinced majority-renter Swiss voters to enact such a tax break?
Wages are taxable income to workers but imputed wages are untaxed. That’s a regressive tax break for people who cook their own food and care for their own children.
Switzerland is transitioning to online voting, and having a digital ID for authentication is helpful for that. I hope it is used as part of the voting process.
My understanding is that the current approach for e-voting in Switzerland works with voters being sent a PIN in the mail [1]. Then the voter uses the PIN to log into the system and vote. Unfortunately that means that insecurely discarded letters from non-voters could be used to cast votes on behalf of these voters.
Some jurisdictions try to use a second factor to prevent these attacks. In Ontario, for example, many municipalities use a combination of the voter's PIN in the mail + the voter's date of birth. But a date of birth isn't really secret. Lots of people know your date of birth (especially insiders at organizations that collect this data), and it may appear in data breaches or even publicly on social media. If you're curious about this, I recently co-authored a paper which is all about security problems relating to online voting credentials in Ontario -- It's relevant to the Swiss case as well: https://link.springer.com/chapter/10.1007/978-3-032-05036-6_...
Long story short, using a digital ID to authenticate to the system (like Estonia does) goes a long way to mitigate this authentication problem. However, there are still plenty of other potential risks with online voting that are unrelated to authentication (how do you prevent ballot stuffing, clientside-vote-altering malware, falsified counts, etc). And there may be privacy risks with digital ID depending on the practical implementation.
Different systems have different approaches. If you're a voter, you can use your web browser's developer tools to see what's going on, and part of my research is essentially doing that with systems like this.
With one Ontario online voting system used by dozens of municipalities, your choice is sent via a form submission (POST) to the server. The POST contains your choice in its body (in plain text) and your browser also sends a cookie/authorization header which contains a token which was generated by the server and given to the client when the client logged in with the PIN/birthday. In that case, the online voting system could identify you and who you voted for at the time the request is made (they receive both the authorization token linked to your identity and the vote in the same request). The vendors then takes procedural steps to then separate you from your vote, and the elections authority running the election receives a report of the totals (but not who each voter voted for) from the vendor.
However, other systems are a bit more complicated. They'll serve you client-side javascript which does cryptography with your PIN / voting choice such that you can prove to the server you are authorized and made a valid vote, but the server can't link your vote to your identity. Then there's a lot of stuff that happens to mix votes together before they are unsealed and counted. I'm not a cryptographer, so I can't give you the best explanation off the dome.
The Swiss system does try to do something that looks like the latter approach, and they hire cryptographers and security professionals (and have public testing) to ensure the system's design meets requirements for ballot secrecy and if the implementation is correct.
There's a video about how ballot secrecy is ensured with the Swiss system which you can watch at this link:
It's only partially open source. Some server-side code remains proprietary, and the client-side will depend on proprietary code of Google and Apple and they do not plan to support platforms that are actually Free Software. The law overall is badly written. For example, articles 12 and 26 effectively say that "The source is shared with public, except if it is proprietary or insecure." Or take Article 4: "The government may operate systems that protect the privacy of the identity subjects."
I'm guessing you'd want to separate age verification from identity verification. A hash of your name is as good as your name since you don't change name and you provide both to certain providers, or it can be bruteforced.
The idea is, if you live in your own house, you’re no better off than if you lived in another property and rented out your property, and paid the tax on the rent you get.
It’s supposed to reduce friction / bias in the market (though you could also obviously argue the reverse).
Unlike the proposed UK digital ID (which is not a "card"), this one is optional. Nobody is being forced to buy a smartphone and accept Apple or Google's terms of service.
Define optional? There will be new checks introduced online where you can only enter if you have an E-ID.
Companies do have to accept a physical card as well, but only if you appear physically at the companies doors. Otherwise, that statement was kind of deceptive in my opinion because there will be a lot of pressure to get one. They also decided to make it free, which shows they probably want to achieve a high adoption.
“Les personnes habitant en Suisse et les Suisses de l'étranger pourront demander une e-ID. L'utilisation de cette dernière ne sera toutefois pas obligatoire. En effet, la Confédération continuera à offrir toutes ses prestations dans le monde réel. Il faudra modifier la loi si l'on veut un jour déclarer obligatoire l'utilisation de l'e-ID dans certains cas. Un référendum pourra alors être lancé contre la modification décidée par le Parlement.”
Automatic translation: “People living in Switzerland and Swiss abroad will be able to apply for an e-ID. However, the use of the latter will not be mandatory. Indeed, the Confederation will continue to offer all its services in the real world.
It will be necessary to amend the law if one day we want to declare the use of e-ID mandatory in certain cases. A referendum can then be launched against the amendment decided by Parliament.”
Optional meaning you have the choice of using the existing physical ID. I don't see how this is deceptive. "A lot of pressure" is not the same as being unable to legally work without the digital ID.
Because they did advertise it in a way to make people believe they could still do their things online without an E-ID, which will not be the case. It's not optional online.
But the Swiss already have a unique digital identifier for everyone living and working in Switzerland (your AVS number I think?) so it's really not optional, and is the primary purpose of the new UK id. The actual application itself is much of a muchness.
Also, the UK gov has already said there will be solutions for old people/time travellers/the Amish etc without phones. Nobody is going to force anybody to buy a phone.
Not much. They are moving from a regime where owner-occupier mortgage interest is deductible but you have to pay income tax on the imputed rental value of your owner-occupied home, to one where you don't pay the tax but also can't take the deduction.
For most Swiss people, who rent, it doesn't directly affect them. And even for most owner-occupiers, they never pay off their mortgages, and so the two effects currently cancel out. It's mostly a handout to rich people who can pay off a house (or inherited one).
Destroys it. The change will immediately raise property prices 5-10%. The only beneficiaries are those who own property today. It becomes harder to buy property, while people who own property free and clear get a huge tax benefit and only lose a tax deduction they weren't using. Essentially, it is generational warfare in the style of Prop. 13 in California.
The price of houses has just gone up because they have removed a real estate tax. Simple, and short sighted. The taxes need to be raised from somewhere so now let's see what convoluted and complex schemes they come up with to do that.
There’s nothing inherently wrong with e-ID, it can be mighty useful, especially when implemented thoughtfully. The real problem is when it’s imposed despite widespread societal opposition and refusal (which obviously is not the issue here, but is in other countries).
I agree that it can be useful, but I fear that in the future, we will have many more online platforms that require an ID than we currently do.
In the past, things like age verification required users to upload a scan or photo, and someone had to verify it. Because that was too much work for the platform operators, they didn't do it (or only with the banner "Are you over 18?").
With the e-ID instead, this will be much simpler to implement. And I expect it to become much more widespread in the future.
For those unfamiliar with this "rental tax": If you own a house in Switzerland, the tax office assumes that you are your own landlord and rent your house to yourself. It estimates the rent you charge yourself, and you have to pay income tax on it.
What makes this tax even stranger: as you are your own landlord, your property interest rate becomes a business expense of your hypothetical rental company. So basically you can deduct your property interest from this income tax on the hypothetical rent you pay yourself. In effect, it is unattractive to repay your mortgage, and private debt in Switzerland is one of the highest in the world.
I'm Belgium this rental tax is the same. You're taxed on the hypothetical rent income.
But... this is based on values of either in the 90s, or 70s.
I remember because the hypothetical income (on a yearly basis) for our 2016 new build was €1,200. Remember, income, not profit.
You couldn't rent a place within 5 miles that was below €1,000 per month.
A sad development. At least in the US, the fact that rent is taxable income to the landlord but imputed rent is untaxed is a regressive tax break for property owners (and was apparently a mistake of the original Form 1040; see Lawrence Zelenak, “The Early Income Tax and the Imputed Rental Income of Homeowners” https://doi.org/10.1017/9781108377157.008). I wonder what convinced majority-renter Swiss voters to enact such a tax break?
Wages are taxable income to workers but imputed wages are untaxed. That’s a regressive tax break for people who cook their own food and care for their own children.
Switzerland is transitioning to online voting, and having a digital ID for authentication is helpful for that. I hope it is used as part of the voting process.
My understanding is that the current approach for e-voting in Switzerland works with voters being sent a PIN in the mail [1]. Then the voter uses the PIN to log into the system and vote. Unfortunately that means that insecurely discarded letters from non-voters could be used to cast votes on behalf of these voters.
Some jurisdictions try to use a second factor to prevent these attacks. In Ontario, for example, many municipalities use a combination of the voter's PIN in the mail + the voter's date of birth. But a date of birth isn't really secret. Lots of people know your date of birth (especially insiders at organizations that collect this data), and it may appear in data breaches or even publicly on social media. If you're curious about this, I recently co-authored a paper which is all about security problems relating to online voting credentials in Ontario -- It's relevant to the Swiss case as well: https://link.springer.com/chapter/10.1007/978-3-032-05036-6_...
Long story short, using a digital ID to authenticate to the system (like Estonia does) goes a long way to mitigate this authentication problem. However, there are still plenty of other potential risks with online voting that are unrelated to authentication (how do you prevent ballot stuffing, clientside-vote-altering malware, falsified counts, etc). And there may be privacy risks with digital ID depending on the practical implementation.
[1] https://digital-solutions.post.ch/en/e-governmenthttps/digit...
How do any of these schemes ensure that votes can't be traced back to individuals? Secrecy is an important part of voting.
Different systems have different approaches. If you're a voter, you can use your web browser's developer tools to see what's going on, and part of my research is essentially doing that with systems like this.
With one Ontario online voting system used by dozens of municipalities, your choice is sent via a form submission (POST) to the server. The POST contains your choice in its body (in plain text) and your browser also sends a cookie/authorization header which contains a token which was generated by the server and given to the client when the client logged in with the PIN/birthday. In that case, the online voting system could identify you and who you voted for at the time the request is made (they receive both the authorization token linked to your identity and the vote in the same request). The vendors then takes procedural steps to then separate you from your vote, and the elections authority running the election receives a report of the totals (but not who each voter voted for) from the vendor.
However, other systems are a bit more complicated. They'll serve you client-side javascript which does cryptography with your PIN / voting choice such that you can prove to the server you are authorized and made a valid vote, but the server can't link your vote to your identity. Then there's a lot of stuff that happens to mix votes together before they are unsealed and counted. I'm not a cryptographer, so I can't give you the best explanation off the dome.
The Swiss system does try to do something that looks like the latter approach, and they hire cryptographers and security professionals (and have public testing) to ensure the system's design meets requirements for ballot secrecy and if the implementation is correct.
There's a video about how ballot secrecy is ensured with the Swiss system which you can watch at this link:
https://digital-solutions.post.ch/en/e-governmenthttps/digit...
Swiss e-ID is self sovereign and built on open protocols.
https://github.com/swiyu-admin-ch
I like that it is open source, I don't like that they use SD-JWT tokens which contain hashes of people's names for things like age verification.
It's only partially open source. Some server-side code remains proprietary, and the client-side will depend on proprietary code of Google and Apple and they do not plan to support platforms that are actually Free Software. The law overall is badly written. For example, articles 12 and 26 effectively say that "The source is shared with public, except if it is proprietary or insecure." Or take Article 4: "The government may operate systems that protect the privacy of the identity subjects."
why is that bad?
I'm guessing you'd want to separate age verification from identity verification. A hash of your name is as good as your name since you don't change name and you provide both to certain providers, or it can be bruteforced.
It's a bit better than that, you really have to get access to the disclosure because the hash also contains a salt. But it's a needless risk
not rental tax. Rental tax on the house you own, if you live in it
At least according to phind
https://www.phind.com/search/cmg40zr9i00002a6lqddmuyxt
I suppose that would count as a progressive tax (as opposed to regressive, like VAT)
It’s actually “imputed rental value tax”.
The point is fairness, not progressiveness.
The idea is, if you live in your own house, you’re no better off than if you lived in another property and rented out your property, and paid the tax on the rent you get.
It’s supposed to reduce friction / bias in the market (though you could also obviously argue the reverse).
So everyone is a permanent renter ?
Unlike the proposed UK digital ID (which is not a "card"), this one is optional. Nobody is being forced to buy a smartphone and accept Apple or Google's terms of service.
Define optional? There will be new checks introduced online where you can only enter if you have an E-ID.
Companies do have to accept a physical card as well, but only if you appear physically at the companies doors. Otherwise, that statement was kind of deceptive in my opinion because there will be a lot of pressure to get one. They also decided to make it free, which shows they probably want to achieve a high adoption.
> Define optional?
“Les personnes habitant en Suisse et les Suisses de l'étranger pourront demander une e-ID. L'utilisation de cette dernière ne sera toutefois pas obligatoire. En effet, la Confédération continuera à offrir toutes ses prestations dans le monde réel. Il faudra modifier la loi si l'on veut un jour déclarer obligatoire l'utilisation de l'e-ID dans certains cas. Un référendum pourra alors être lancé contre la modification décidée par le Parlement.”
Automatic translation: “People living in Switzerland and Swiss abroad will be able to apply for an e-ID. However, the use of the latter will not be mandatory. Indeed, the Confederation will continue to offer all its services in the real world. It will be necessary to amend the law if one day we want to declare the use of e-ID mandatory in certain cases. A referendum can then be launched against the amendment decided by Parliament.”
Optional meaning you have the choice of using the existing physical ID. I don't see how this is deceptive. "A lot of pressure" is not the same as being unable to legally work without the digital ID.
Because they did advertise it in a way to make people believe they could still do their things online without an E-ID, which will not be the case. It's not optional online.
But the Swiss already have a unique digital identifier for everyone living and working in Switzerland (your AVS number I think?) so it's really not optional, and is the primary purpose of the new UK id. The actual application itself is much of a muchness.
Also, the UK gov has already said there will be solutions for old people/time travellers/the Amish etc without phones. Nobody is going to force anybody to buy a phone.
AFAIK, the UK gov has only said there will be solutions for people unable to use a phone, not people unwilling to use a phone.
" As part of our consultation, we will be making sure the scheme is inclusive by considering:
- physical alternatives are available for those without smartphones "
From
https://www.gov.uk/government/publications/digital-id-scheme...
>the Swiss already have a unique digital identifier
Digital as in being a sequence of thirteen digits?
Abolishing rental tax is huge. What does that do for affordability?
Not much. They are moving from a regime where owner-occupier mortgage interest is deductible but you have to pay income tax on the imputed rental value of your owner-occupied home, to one where you don't pay the tax but also can't take the deduction.
For most Swiss people, who rent, it doesn't directly affect them. And even for most owner-occupiers, they never pay off their mortgages, and so the two effects currently cancel out. It's mostly a handout to rich people who can pay off a house (or inherited one).
Destroys it. The change will immediately raise property prices 5-10%. The only beneficiaries are those who own property today. It becomes harder to buy property, while people who own property free and clear get a huge tax benefit and only lose a tax deduction they weren't using. Essentially, it is generational warfare in the style of Prop. 13 in California.
Why will property prices increase by 5-10%? How was that range calculated?
It's what Swiss wealth management firms are predicting.
The price of houses has just gone up because they have removed a real estate tax. Simple, and short sighted. The taxes need to be raised from somewhere so now let's see what convoluted and complex schemes they come up with to do that.
makes swiss landlords richer. Foreign nationals cannot own rental homes.
Not at all, it depends on the residence permit. With a C permit you can buy and rent properties, while with B you can buy only your own home
Not quite. If you reside in Switzerland, you can own rental homes. Just foreign non-residents cannot buy.
Can you go into more detail?
This only affects homeowners who live in their own property, not landlords. If you earn rent on your property, you will still pay income tax on it.
There’s nothing inherently wrong with e-ID, it can be mighty useful, especially when implemented thoughtfully. The real problem is when it’s imposed despite widespread societal opposition and refusal (which obviously is not the issue here, but is in other countries).
I agree that it can be useful, but I fear that in the future, we will have many more online platforms that require an ID than we currently do.
In the past, things like age verification required users to upload a scan or photo, and someone had to verify it. Because that was too much work for the platform operators, they didn't do it (or only with the banner "Are you over 18?").
With the e-ID instead, this will be much simpler to implement. And I expect it to become much more widespread in the future.
Indian Aadhaar has some examples discussed here
https://news.ycombinator.com/item?id=41608810