Additional housing costs that will come out of the tax breaks enjoyed by British ex-pats in Geneva could affect the local housing market, telegraph.co.uk reports.
The Genevan tax break dates back some 150 years and has been identified as one of the main reasons for Brits to move to the Swiss city, as it enables them to drastically reduce both income and wealth tax.
Changes to the system could be on the horizon, however, which may then impact property prices in the area. Whilst current uncertainty has prompted a slowing in the sale of luxury properties in Geneva, it could also prove to be of benefit to those thinking of a move in the not-too-distant future, with house prices anticipated to fall slightly whilst the decision is being mulled over.
In this case, overseas property investors have the chance to secure Genevan property at a historically low value, but the strength of their gamble will be determined by the eventual decision and whether additional costs are introduced.
If it is brought in, the tax amendment would see foreign nationals pay a "forfeit", which is a single flat fee that goes into the local canton purse. This is not worked out on a tax basis, or even on the sale value of a property, but instead the potential rental yield. The current system whereby homeowners are not obliged to reveal their incomes looks set to continue unchanged.
Such changes may not even take hold, however, as the local government has already shot down complaints made by residents unhappy at the number of rich foreigners moving in. It has already rejected proposals to remove the tax break, but is now considering this most recent suggestion.
All the while there is indecision, however, house prices are fluctuating, especially at the higher end of the market, news.yahoo.com has claimed.