Cancellation of hardship rule for imputed rental value

The Administrative Court of the Canton of Zurich and the Federal Supreme Court have ruled that there is no legal basis for the hardship case rule for imputed rental value.

As a result, the imputed rental value must now be taxed according to the property valuation of the municipality. Until now, some cantons have granted tax rebates to property owners with a low income. This was intended to prevent them from having to sell their property in order to pay their taxes. This often affected pensioners who own a house but live on a modest pension. The Federal Supreme Court has now ruled that people who own a house may not be categorised as a case of hardship. The Federal Supreme Court considered the hardship clause in the canton of Ticino to be a violation of the constitutional principle of equal treatment of homeowners and tenants. The extent to which cantonal hardship regulations will be overturned remains to be seen. (Source: BGE 2C_605/2021 of 4 August 2022)