The Tax Marriage Penalty – Analysis of a Controversial Phenomenon
Published on 2025-10-11 · by Braingroup AG
For a long time, the tax inequality between married couples and couples living in a registered partnership in Switzerland has caused discomfort. Opponents of the so-called "marriage penalty" emphasize that marriage should not be devalued by financial disadvantages. They demand tax equality to create a fair and neutral starting point for all living arrangements. The following article explains the potential tax implications of a possible new legislative framework.
What is behind the term "marriage penalty"?
The term "marriage penalty" describes the phenomenon that married couples in Switzerland are subject to a higher tax burden compared to couples living in a registered partnership with the same income. This is largely due to the progressive tax system, where a higher income is taxed at a proportionally higher rate. Since the incomes of spouses are combined for tax calculations, they often fall into a higher tax bracket than unmarried couples, whose incomes are taxed individually.
In the summer session in June 2025, the proposal to abolish the "marriage penalty" was accepted by a narrow majority in both the National Council and the Council of States. It is generally expected that a referendum will be initiated and that the electorate will have the final say.
What changes with a legislative adjustment?
If the "marriage penalty" is indeed abolished, individual taxation will be implemented. Here, each partner – regardless of marital status – will be taxed separately based on their individual income. This would have far-reaching financial consequences.
Consequences for married couples: Depending on the distribution of individual incomes, the tax burden may change. If most of the income comes from one person, this could even lead to a higher tax burden. Reason: The income will now be taxed individually and thus at a higher tax rate, as the lower tax rate for married couples will no longer apply. This particularly negatively affects "single-income couples," as they would have to pay significantly more taxes in the future. However, if the incomes are balanced, individual taxation will generally lead to a lower tax burden in most cases.
Consequences for partnerships without children: The tax situation is expected to remain unchanged, as both partners are already taxed individually.
Consequences for partnerships with children: The child deduction is expected to change from CHF 6,800 to CHF 12,000 per child. This would tend to lower taxes for couples living in a registered partnership.
The financial consequences
The following examples clearly illustrate the effects of the "marriage penalty." The focus is on the tax situation of married and unmarried couples concerning federal tax, as an adjustment is initially only planned at the federal level. However, it is assumed that future cantonal and municipal tax laws will be adjusted in a similar manner. Such changes would significantly amplify the impact on the overall tax burden.
The current figures were calculated using Omnium, the financial advisory software of Braingroup AG. The new figures were created according to the progression table of the current draft law (source: https://www.newsd.admin.ch/newsd/message/attachments/86239.pdf). All figures are in Swiss francs.
Family with 2 dependent children:
| Married (Current*) |
Married (New**) |
Difference (Current vs. New) |
|
|---|---|---|---|
| Net income Person 1: 120,000 Net income Person 2: 0 |
1,035 | 2,524 | +1,489 |
| Net income Person 1: 120,000 Net income Person 2: 120,000 |
10,997 | 5,048 | -5,949 |
| Net income Person 1: 90,000 Net income Person 2: 60,000 |
1,786 | 616 | -1,170 |
| Net income Person 1: 60,000 Net income Person 2: 60,000 |
455 | 0 | -455 |
Spouses without children:
| Married (Current*) |
Married (New**) |
Difference (Current vs. New) |
|
|---|---|---|---|
| Net income Person 1: 120,000 Net income Person 2: 0 |
2,324 | 3,803 | +1,479 |
| Net income Person 1: 120,000 Net income Person 2: 120,000 |
13,473 | 7,606 | -5,867 |
| Net income Person 1: 90,000 Net income Person 2: 60,000 |
3,254 | 1,896 | -1,358 |
| Net income Person 1: 60,000 Net income Person 2: 60,000 |
1,586 | 814 | -772 |
Partnership with 2 dependent children:
| Partnership (Current*) |
Partnership (New**) |
Difference (Current vs. New) |
|
|---|---|---|---|
| Net income Person 1: 120,000 Net income Person 2: 0 |
1,270 | 2,524 | +1,254 |
| Net income Person 1: 120,000 Net income Person 2: 120,000 |
4,801 | 5,048 | +247 |
| Net income Person 1: 90,000 Net income Person 2: 60,000 |
736 | 616 | -120 |
| Net income Person 1: 60,000 Net income Person 2: 60,000 |
366 | 0 | -366 |
Partnership without children:
| Partnership (Current*) |
Partnership (New**) |
Difference (Current vs. New) |
|
|---|---|---|---|
| Net income Person 1: 120,000 Net income Person 2: 0 |
3,779 | 3,803 | +24 |
| Net income Person 1: 120,000 Net income Person 2: 120,000 |
7,558 | 7,606 | +48 |
| Net income Person 1: 90,000 Net income Person 2: 60,000 |
2,295 | 1,869 | -399 |
| Net income Person 1: 60,000 Net income Person 2: 60,000 |
1,128 | 814 | -314 |
*Current deductions: Professional expenses 3% net salary, min. 2,000, max. 4,000 / Insurance premiums 3,700 + 700 per child (1,800 per person in partnership) / Child deduction 6,800 per child / Second earner deduction 14,100 (only married) / Married deduction 2,800 (only married) / Reduction of tax amount per child 263
**New deductions: Professional expenses 3% net salary, min. 2,000, max. 4,000 / Insurance premiums 1,800 per person + 700 per child / Child deduction 12,000 per child / Reduction of tax amount per child 263 / Child deductions will be assigned equally per person
Impact on financial advisory
A potential legislative adjustment has far-reaching consequences for financial planning.
New rates, additional deduction options, and tax adjustments require expanded expertise and bring additional administrative burdens.
Advisors must be able to quickly and easily determine the tax-optimal arrangements for their clients – for example, when it comes to the form of living arrangement (marriage yes/no) or the assessment of the employment of second earners.
Clients expect complete and understandable clarification of all tax implications.
Thanks to efficient tools adapted to the new regulations, differences and scenarios can be easily visualized. Targeted comparisons of different variants allow for demonstrating how tax burden, retirement planning, inheritance planning, and other financial aspects can be optimally structured. This creates a holistic, forward-looking advisory service that provides clients with long-term financial clarity and security.
Conclusion: The abolition of the marriage penalty could fundamentally change the financial landscape for many couples in Switzerland. By addressing the potential impacts early on as a financial advisor, you can optimally prepare your clients for these potential changes.
Authors: Markus Büchel, Co-Founder Braingroup AG and Daniel Volkart, Expert Product Manager Braingroup AG