Zurich's Tax Miracle 2.0: Lots of Money, Lots of Morals, Lots of Deficit
On March 10, 2016, Christina Neuhaus wrote in the NZZ to the effect that: Zurich is not stuck in a growth trap, Zurich benefits from its growth. Ten years later, it can be stated: The city has not imploded since then, but has continued to grow — to 452,421 inhabitants by the end of 2025. Compared to the 410,404 from that earlier text, that's a good 42,000 more people, practically another medium-sized town on top. Zurich thus remains primarily one thing: very popular, very full, and very convinced that both are marks of quality.
Politically, too, the city has just reaffirmed that it wants to stick to this model. In the elections of March 8, 2026, the SP, Greens, and AL defended their narrow majority in the municipal council with 63 out of 125 seats; the SP gained four seats, FDP and SVP each gained two, while the Greens and GLP lost seats and the EVP is in danger of falling out of parliament. In the city council, the government became even greener: the Greens secured a third seat with Balthasar Glättli at the expense of the FDP. And for the mayoral position, Zurich allows itself the typically Zurich luxury of a runoff on May 10, even though Raphael Golta is clearly ahead. Bureaucracy can be elegant here even when it seems superfluous.
The interesting question, however, is not who has overtaken whom, but whether the old "tax miracle" still lives. The short answer: yes, and quite robustly. In 2024, the city collected a total of 3.7163 billion francs in taxes. Of this, 2.2416 billion came from natural persons, 966.1 million from legal entities, and 508.6 million from other taxes. For 2026, the city even budgets 3.8911 billion francs. That's not a growth trap, that's a growth machine with a very decent receipt.
It gets even nicer when looking at tax capacity. The tax rate remains at 119 percent. Tax capacity per capita was 6,163 francs in 2024 and is budgeted at 6,380 francs for 2026. At the same time, the 2026 budget includes 434.4 million francs in the financial and burden equalization item; the city explicitly justifies this with its above-average financial strength. So Zurich not only pays many taxes but also gets to pay for being so fiscally potent. One can hardly appear richer except in an editorial.
And here begins the part where the tax miracle nervously fidgets with its credit card. Despite the high revenues, the city expects an expenditure surplus of 351.9 million francs in the 2026 budget. For 2027 to 2029, it plans further deficits between approximately 352 and 379 million francs per year. The unrestricted equity would thus shrink from 2.8644 billion francs at the end of 2024 to 1.1956 billion by 2029. The self-financing ratio falls to 20.9 percent in the 2026 budget, and net debt per capita rises to 16,388 francs according to the budget. In other words: Zurich doesn't have a revenue problem. Zurich has a very urban talent for modeling a chronic need for money from solid tax substance.
This makes the punchline of the 2016 NZZ text almost even sharper today. Yes, growth in Zurich still finances a considerable part of its own costs. The tax base is strong, the city remains attractive, the population continues to grow. But it's equally clear: growth doesn't cure political spending enthusiasm. Anyone who still speaks of the "growth trap" today is confusing cause and effect. The trap is not growth. The trap is the notion that a city can simultaneously build more and more, care for more, regulate more, subsidize more, air-condition more, green more, and morally refine more — and then act surprised when the bill eventually doesn't sit as loosely as the bicycle courier at Sechseläutenplatz.
In addition: even on the corporate side, the mood is not carefree. In the financial and task plan, the city writes that the revenue from legal entities is 70 million francs below the previous year in 2026 and the tax consequences of UBS's takeover of Credit Suisse remain unclear. So the tax miracle lives, but it no longer lives in that carefree euphoria of old. Rather in the attitude of a CFO who has good revenues but prudently never lets go of the calculator.
The political finding remains. The people of Zurich have just not voted for a budget consolidation with a charm offensive. They have elected an even somewhat greener executive and confirmed a wafer-thin left parliamentary majority. That is their right. But then please, no one should pretend that the city is a victim of some foreign demographic fate. Zurich didn't grow into this situation. Zurich has organized it for itself democratically, with strong tax revenues, and with remarkable self-satisfaction. And you have to give this city credit: even its contradictions arrive here with excellent public transport connections.