Le Matin: "Vaud, a haven for billionaires."

Vaud Canton: paradise for multimillionaires

Le Matin, November 27, 2002
Caroline Zingg

Tailored taxation"

How are the very rich taxed? Although some of them have the benefit of a flat rate, this is not the case for many of the 300 “golden people” in this category. In fact, one of the conditions that needs to be met in order to qualify for flat-rate taxation is that you must not have worked in Switzerland for the past 10 or 20 years (depending on the canton). Ernesto Bertarelli, for example, is not eligible.
However, Ingvar Kamprad, the founder of Ikea, is eligible due to the fact that he is the founding president. Mr. Micheloud, financial advisor for the wealthy explains:

-How is a flat rate negotiated?
-It depends on the client and where he or she wants to live. We compare the cantons and negociate with them. But we do not have much leeway. The tax authorities are very strict and often boost the rates.

-How is the flat rate calculated?
-It’s based on an estimate of what the client will spend in Switzerland during the year. The determining factor is the annual rental value of the client’s house. This value is multiplied by five for the allowable minimum taxable income.

-Why does Vaud Canton have the highest number of flat rates in Switzerland?
-The area surrounding Lake Geneva is still the most attractive region in Switzerland. The explosion of the housing market in Geneva combined with the elistist policy on flat rates makes this region virtually unaffordable. Therefore, Vaud Canton is the solution for those who want to move to the region. However, if it becomes increasingly certain that current restrictions in Vaud Canton are here to stay, those who are on flat rates may move to Valais, a more motivating canton in terms of flat-rate taxation. Don’t forget that there are 26 cantons in Switzerland and that Monaco’s flat rates are holding at zero francs. We need to decide whether we want to keep the stars here or chase them away.

Interview by C.Z.

With a fortune of 14 or 15 billion, Ingvar Kamprad, the founder of Ikea, is the richest man in the country. He has overthrown Ernesto Bertarelli, whose fortune relegates him to fourth place, behind the Rausing and Oeri families. Four of the five richest people in Switzerland live in Vaud Canton. Let’s find out why.

Vaud Canton is tied with Geneva when it comes to carrying the highest debt load in Switzerland. Ironically, it also has become home to the four wealthiest people in the country, as indicated in a document published by Bilan. "Vaud Canton is picturesque; houses look out onto the lake; and it’s said that it reminds some Scandinavians of the natural beauty of their homelands", cheerfully states Olivier Toublan, the co-editor of Bilan.

As confirmation, two Swedes are at the top of the list: Ingvar Kamprad, the founder of Ikea and resident of Epalinges for the last 25 years, has a accumulated fortune of about 14 or 15 billion francs. Just behind him is the Rausing family: Birgit, resident of Montreux and the widow of the man who created Tetra Pak, has a fortune of 13 to 14 billion.

Behind the Oeri-Hoffmann family and the flamboyant Gigi Oeri who is an ardent fan and patron of FC Bale, is "poor" Ernesto Bertarelli, who has now been relegated to fourth place. Although he was ranked as having 13 to 14 billion in 2001, his fortune has decreased by half. The handsome industrialist, who lives on the coast in Vaud Canton, still has the wind in his sails, even if he "only" has seven or eight billion. Equally ranked is the Landolt family who inherited their grandfather’s fortune. He was the founder of the Sandoz chemical company, which was later taken over by the foundation of the same name, and is located in Pully.

One third of the 300 richest people in Switzerland live in the French-speaking area and the other two-thirds live across the Sarine. It should be noted that, like others, these fortunate few have also been affected by the economic crisis. But not in the same way as Mr. Joe Average. Their fortunes only dropped by 13% in 2002 and 7% in 2001. Which doesn’t affect most of them very much.

Another sign of the times: " The bulk of the new economy has disappeared from our category", adds Olivier Toublan. Andre Kudelski is one of the survivors. Two years ago, his fortune was estimated at three to four billion. In 2002, it plunged to 300-400 million due to the fact that his company’s stocks dropped by 90%. The luckier people are to be found in companies that are not listed on the stock market. They fared better than the others, much like the unassuming founder of Ikea, Ingvar Kamprad, and about 100 other lucky people who are benefiting from Switzerland’s mild economic climate.

Respectable economic refugees make their new hometowns very happy. (more below)
A former member of the honor roll has basically dropped off the list: Martin Ebner, whose fortune was estimated at more than four billion last year, has accumulated more than two billion in debt, according to experts.

Ranking of the Other Stars

VAUD
Athina Onassis, shipowner, 4 to 5 billion
Michael Schumacher, Formula 1, 600 to 700 million
Andre Kudelski, computing, 300 to 400 million
Asher Edelmann, finance, 200 to 300 million
Lamuniere Family, Edipresse, 200 to 300 million
Shania Twain, singer, 200 to 300 million
Daniel Borel, Logitech, 100 to 200 million
Phil Collins, musician, 100 to 200 million
Jacques Villeneuve, Formula 1, 100 to 200 million

GENEVA
Lombard Odier Darier Hentsch & Associates, bank, 3 to 4 billion
Edgar de Picciotto, banker, 2 to 3 billion
Maus, Nordmann, Manor Families, 1.5 to 2 billion
Scheufele-Gruosi, Chopard Families, 1 to 1.5 billion
Jean-Louis David, hairstylist, 300 to 400 million
Franck Muller, watchmaking, 300 to 400 million
Raymond Weil, watchmaking, 300 to 400 million
Charles Aznavour singer, 100 to 200 million
Yeslam Binladin, financial, 100 to 200 million
Brunschwig Family, Bon Genie, 100 to 200 million
Daniel Hechter, fashion, 100 to 200 million

Other Cantons

ARGOVIA
Nicolas Hayek, Swatch Group, 1.5 to 2 billion

BERNE
Bernie Ecclestone, Formula 1, 4 to 5 billion

ZURICH
Christoph Blocher, EMS-Chemie, 2 to 3 billion
Karl Schweri, Denner, 1.5 to 2 billion
Robert Louis-Dreyfus, Adidas, 800 to 900 million
Ringier Family, media, 800 to 900 million
Walter Frey, automotive, 500 to 600 million
Tina Turner, singer, 200 to 300 million