Lucerne as a centre for business and innovation – further development of location promotion

In recent years, the canton of Lucerne has developed into an attractive business location offering a high quality of life for its residents. Supported by a wide variety of small and medium-sized enterprises, it is also home to numerous large, internationally active companies. The tax situation is encouraging: by 2026, the canton of Lucerne will be the location with the lowest corporate tax rates in Switzerland. This impressive transformation is the result of a forward-looking strategy comprising a successful tax policy, structural reforms and targeted cost-cutting programmes. Patrik Wermelinger, Director of Lucerne Economic Development: “Thanks to the creation of commercial space, the expansion of infrastructure and an ambitious tax policy, Lucerne as a business location is where it is today.”

Ensuring the region’s attractiveness for the future
Nevertheless, the canton must not rest on its laurels. The continuous development of location factors remains crucial to ensure that Lucerne remains beneficial in the long term for both businesses and the population. This applies not only in view of the tense geopolitical situation and the strong Swiss franc. The OECD minimum tax came into force at the start of 2024. Since then, internationally active companies with an annual turnover of over EUR 750 million have been required to pay at least 15 per cent in corporation tax. This is fundamentally changing international competition between business locations: a location’s attractiveness comes under pressure when large firms are taxed at a higher rate than smaller ones. Whilst the absolute top corporation tax rates are becoming slightly less relevant, financial incentives are taking centre stage in international competition between business locations. Targeted business promotion is therefore more in demand than ever: “Attractive operating conditions are crucial for companies. We therefore need new instruments to continue to meet this need,” says Patrik Wermelinger.

In the canton of Lucerne, around 200 companies are affected by the OECD minimum tax. This is forecast to generate additional annual revenue in the hundreds of millions. The government and parliament intend to use part of these funds in a targeted manner to secure the canton’s long-term appeal to businesses and the population. This will help reduce the risk of large companies relocating elsewhere, thereby safeguarding vital jobs and tax revenue. Thanks to its already favourable tax environment, the canton of Lucerne is able to reinvest in its future attractiveness through a comprehensive package of business support measures.

As a basis for designing the package, the Canton of Lucerne carried out a comprehensive location analysis. This led to the identification of specific measures that will benefit both businesses and the population, thereby achieving the widest possible impact.

Added value for the public and businesses
The high quality of life for its residents is a hallmark of the Canton of Lucerne. For this reason, the local population is also set to benefit from the package of measures. The main focus is on tax rate reductions and the promotion of supplementary childcare. Further priorities lie in the areas of culture and digitalisation. For businesses, the business promotion package focuses primarily on fostering innovation. Further measures relate to tax rate reductions, the availability and development of commercial land, and the promotion of international schools. The latter play a crucial role in retaining existing foreign companies in the region and attracting new ones. Although an inclusive approach is always pursued when attracting new businesses, international schools remain a key selling point for foreign firms. In addition, digitalisation and a customer-focused administration are to be further advanced in this area too.

Where companies innovate, greater value is created – and this generates prosperity for the entire population. Accordingly, the promotion of innovation is at the heart of the business location promotion package. The Lucerne Innovation Grant (LIB) is designed to provide targeted support to existing and new companies in the fields of research, development and innovation.

In addition to the LIB, the start-up and innovation ecosystem is to be fostered through support for innovation stakeholders, SMEs and start-ups. The planned ‘Lucerne Innovation’ foundation is set to play a central role in this. The Cantonal Council is expected to debate this matter in 2027.

The package of measures will also benefit Lucerne’s municipalities: the focus on digitalisation will ease their administrative burden. Furthermore, they will benefit from co-funding for the development of commercial sites and the further development of the canton’s key development priorities. Last but not least, the measures in the areas of supplementary childcare and cultural promotion will also have a positive impact on the municipalities. Where there is synergy between the economy and the population, prosperity and well-being are created for all, and the entire region benefits.

The referendum is scheduled for 27 September 2026. Regardless of the outcome of the vote, issues such as the promotion of innovation, the availability of commercial land and digital administrative processes will remain key location factors for companies wishing to expand or establish themselves in Lucerne.