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Swiss plan property ‘Millionaire zones’ - 23 June 2009

The plans of one district of Switzerland to allow the super-rich to settle in their region by relaxing planning laws on previously protected land has caused a political outcry and sparked accusations that the local government is operating one rule for the rich and one for the poor.

The plans have even sparked a row over the possible real estate ‘apartheid’ forming between rich and poor with the launch of the ‘special living zones’ for millionaires in the Swiss canton of Obwalden. The proposal to open up previously-protected agricultural land for development by the rich is a move designed to ease the pressure on the region’s revenue sources and increase tax revenue. Obwalden, like many other Swiss cantons, has been competing to offer the lowest tax rates to citizens, in order to attract people and businesses that will spend money in other ways in the area. The result has been a dramatic shortfall in revenue as companies set up PO boxes to take advantage of the low tax rates while being based elsewhere.

The proposed answer has been to lift construction bans on the land reserved for agricultural use, which will alert the rich to the possibility of buying on protected land with spectacular alpine and lake views. The details of the plans, published in the Swiss press last week and in the Guardian newspaper here, suggest selling villas to those who pay higher tax rates or create jobs in the region – and are likely to promise that their views will never be blocked by other buildings as the rest of the land will remain protected.

The fact that the homes would be constructed on land unavailable to ordinary citizens and sold to specific groups of the rich have led to accusations of property discrimination. “These special living zones are nothing less than a form of apartheid,” said Moritz Leuenberger, of the Social Democrats. “Is a racing car driver of so much more use than a nurse?”

Switzerland has long been synonymous with privacy for the rich – a numbered Swiss bank account was once the sign of real wealth where no questions were asked.

Farmers and the Green party have joined a campaign to stop the special zones, but the decision-makers in Obwalden remain certain they are making the right decision. The authorities say that those who have more money should benefit from a wider choice of where to live, citing the example of first- and second-class travel, which gives people the choice of what they want to pay. However, the counter-argument is likely to focus on the fact that the poor will be ‘excluded’ from buying in these new zones.

The people of Obwalden are likely to have their chance to have their say on the issue at a referendum later this year, but if passed, the ‘special zones’ are likely to attract foreign investors looking for a property in Switzerland that won’t hurt their tax status too much.

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