On 20 June 2014, both the Swiss Federal Council and the EU Economic and Financial Affairs Council agreed to initial a mutual understanding agreement on how Switzerland will reform its corporate tax regime. The reform is needed for Switzerland to comply with the EU code of conduct for business taxation and alleviate straining relations between Switzerland and EU Member States.

The Swiss Federal Department of Finance will coordinate with the Federal Department of Foreign Affairs to prepare the agreement for initialing. The agreement will list the principles and mutual intentions for reform, but will not include any state treaty obligations.

The agreement will reaffirm the intent of the Swiss Federal Council to propose the abolishment of certain tax regimes, particularly the different treatment of domestic and foreign revenue, and to develop tax measures in line with international standards. As part of the agreement, the EU Member States will confirm their intent to remove respective countermeasures as soon as the Swiss regimes in question have been abolished.

No date has been set for the initialing of the agreement, but it is expected within the second half of 2014.