12.3 Penalties on VAT assessments when VAT is not reported correctly

For tax evasion a fine of up to CHF 400’000.- is imposed on anyone who intentionally or negligently reduces the tax claim to the detriment of the state, by:

• not declaring in a tax period all receipts, declaring too high receipts from supplies exempt from the tax, not declaring all expenses subject to acquisition tax or by declaring too high expenses entitling to input tax deduction;
• by effecting an incorrect refund; or
• by effecting an unjustified tax abatement.

The amount of the fine is up to CHF 800’000.- if the tax evaded in the cases mentioned above entitles to input tax deduction.

A fine of up to CHF 200’000.- is imposed on anyone who reduces the tax claim to the detriment of the state by declaring the tax factors relevant for establishment of the tax truthfully, but qualifies them incorrectly for tax purposes, provided that he intentionally does not apply properly clear legal provisions, ordinances of the authorities or published practice rules and does not inform the authorities, in writing, in advance. If perpetrated negligently, the fine is up to CHF 20’000.-.

A fine of up to CHF 800’000.- is imposed on anyone who reduces the tax claim to the detriment of the state, by:

• intentionally or negligently not declaring or declaring incorrectly or concealing goods on import; or
• in response to an enquiry, intentionally giving no, false or incomplete information during an official audit or administrative procedure that has, as its object, the establishment of the tax claim or tax abatement.

If the tax benefit is obtained on the basis of an incorrect return, the tax evasion is not punishable before the period for correction of errors in the return has expired (Art. 72 para. 1 VAT Law) and the error has not been corrected.