Zug retains top slot for locational quality

After years of flux due to the corporate tax reform, the locational quality ranking shows a stable picture in 2022 as in the previous year. The Canton of Zug retains its position at the top of the cantonal rankings, ahead of Basel-Stadt, Zurich, and Geneva. The Canton of Aargau has suffered the biggest ranking loss, dropping two places.

Canton of Zug once again comes out top for locational quality in 2022

The top slots in the cantonal rankings remain unchanged in 2022: Zug is in first place, followed by the Canton of Basel-Stadt. Both cantons offer a highly attractive combination of factors, with Zurich and Geneva lying some distance behind.


A number of shifts occurred in the case of other cantons, however: Nidwalden and Schwyz improved their positions, pushing the Canton of Aargau into seventh place.
In the midfield – led by Lucerne – Schaffhausen overtook Thurgau and moved into 9th place. This is mainly thanks to a tax cut for private individuals, but also a result of small improvements in terms of accessibility indicators. The Canton of Obwalden shows a better performance in terms of education and accessibility indicators and moves up two places to make it the biggest gainer.


After two years, there is a change at the bottom end of the rankings, too: The Canton of Valais is reducing corporate taxes slightly more than the Canton of Jura, pushing the latter into last place.

2022 locational quality study

Detailed rankings, causal factors, and forecasts concerning the locational quality of Switzerland's regions and cantons.


The Locational Quality Indicator (LQI) compiled by Credit Suisse measures the attractiveness of Swiss cantons and regions to business compared to Switzerland's average. The LQI is based on the following seven quantitative sub-indicators: tax burden on private individuals and legal entities, availability of highly qualified personnel and specialist labor, population accessibility, employee accessibility, and access to airports.


Locational quality of cantons is changing gradually

Most cantons saw little change in their position between 2013 and 2022. Fact is, the basic framework conditions typically evolve at a slow rate and the rankings therefore remain stable in 2022 in overall terms.


However, some cantons are currently performing better than in 2013 thanks to a significant increase in tax appeal for companies. The Canton of Basel-Stadt, for example, is now in competition with first-placed Zug thanks in part to the high degree of availability of highly qualified employees. The cantons of Bern and Obwalden, on the other hand, have become less attractive: Relative to the other cantons, they show the biggest drop in rankings in the period observed at four places in each case.

Transport accessibility is key to locational quality 

For the larger, heterogeneous cantons, an analysis of locational quality at cantonal level fails to show the full picture and it is therefore worth taking a look at municipal level: The urban centers of Zurich, Zug, Basel, Baden, and Geneva as well as their wider agglomerations, are among the most attractive regions for companies, not least due to their high transport accessibility. Alpine regions and the regions of the Jura Arc, on the other hand, remain less attractive to companies. This is because of their geographical location as well as – in some cases significant – travel times to metropolitan centers. 

Swiss Tax Monitor by Credit Suisse

The "Swiss Tax Monitor" series published by Credit Suisse provides a compact overview of the tax burden for companies and private individuals based on location. That enables them to quickly assess the attractiveness of cantons and municipalities from a tax perspective.


What's the outlook for the locational quality of the cantons?

A number of further reductions in tax are likely by 2025 – particularly in the cantons of Basel-Land and Ticino. In addition, international efforts to reform global corporate taxation may put pressure on certain cantons to raise taxes again slightly. Specifically, the planned introduction of an international minimum tax rate for turnover-rich companies would limit or even wipe out Switzerland's tax competitiveness in some cases. Other factors – including access to qualified personnel and accessibility – would then become more significant within the locational rankings.