On September 28, 2025, the Swiss people will vote on the abolition of the imputed rental value. The imputed rental value is a notional income that owners of owner-occupied properties must declare in their tax return. This value corresponds to around 60 to 70 percent of the rent that could be earned for the property. The abolition of the imputed rental value is linked to the introduction of a new property tax on second homes in order to compensate for potential tax losses for the cantons.
Linked decisions and cantonal differences
The vote on the abolition of the imputed rental value is closely linked to the introduction of a cantonal property tax on second properties. This tax is subject to a mandatory referendum, which means that the imputed rental value will only be abolished if the people and cantons approve the new tax. The voting results could vary greatly between the cantons, as the impact varies greatly from canton to canton.
The Central Board of the Swiss Federation of Master Builders has decided to abstain from voting, as the pro and contra arguments are balanced from a national perspective. Almost 1.4 million households in Switzerland would be affected by the abolition, which corresponds to around a third of all households. The reduction in tax revenue is estimated at CHF 1.7 billion per year1.
Effects on renovations and tax deductions
The abolition of the imputed rental value would also mean that deductions for maintenance costs such as energy-related renovations for owner-occupied residential property would no longer apply at federal level. However, at cantonal level, deductions for dismantling costs for replacement new builds, expenses for monument preservation and energy-saving measures would remain permissible. It remains uncertain to what extent the lack of deductibility will actually lead to a reduction in renovations, as the tax burden for property owners would also fall thanks to the abolition of the imputed rental value.
Property tax on secondary properties
The introduction of property tax on secondary properties is intended to help the cantons compensate for any tax losses. Each canton can decide for itself whether it actually introduces this tax and to what extent. The abolition of the imputed rental value has been the subject of political debate for decades and has so far survived every attack. in 2017, parliament made a new attempt to abolish the imputed rental value4.
A hotly contested vote
The vote on the abolition of the imputed rental value and the introduction of property tax on second homes is likely to lead to a hotly contested vote. The bill is linked to the Federal Act on the System Change in Home Ownership Taxation. Only if the constitutional amendment is approved by the people and the cantons in the referendum can the bill for the change in the system of residential property taxation and thus the abolition of imputed rental value taxation come into force.
The Swiss Homeowners’ Association has already decided to vote in favor of the proposal. The abolition of the imputed rental value tax is considered to be long overdue. The “Eigenmietwert-Nein” committee also recommends a Yes vote on the bill to abolish the imputed rental value tax.
