Lucerne opens innovation contribution with refundable tax-credit option

Eligible businesses need real Lucerne substance

New sections 16a–16d of the Law on Location Promotion and Regional Policy (StaReG, SRL 900) create an entitlement, within available funds, for businesses recorded in Lucerne’s commercial register that have genuine economic presence in the canton, demonstrate sustainable business practices and maintain reliable accounts. Lucerne’s handbook treats genuine presence as requiring premises and personnel in the canton. A foreign or out-of-canton company needs a registered Lucerne branch; a taxable permanent establishment alone is insufficient.^[1][2][4]

Four expenditure categories attract different rates

The contribution covers basic and industrial research, experimental development, organisational and process innovation, certain clinical trials and connected management or support work. Under section 9 StaReV, the base comprises qualifying expenditure economically borne by the applicant in Lucerne. Section 10 sets rates of 30% for personnel costs, 20% for investment costs and 10% for both contract-research and other qualifying expenditure, subject to the 50% statutory ceiling in section 16b(1) StaReG.^[1][2][5]

Other incentives reduce the award

The gross contribution is reduced by tax savings from Lucerne’s innovation incentives under sections 72b and 72f of the Tax Law and by other financial assistance for the same activities. If applications exceed the available appropriation, section 16b(4) requires proportional reductions. Lucerne’s 2026 budget assigns CHF110 million to the programme; the Cantonal Council will set later appropriations annually.^[2][3][4]

The payment choice has Pillar Two consequences

Section 16d StaReG allows the contribution as cash, a refundable credit against Lucerne cantonal and municipal profit or capital tax, or—where higher-level rules do not treat it as tax-reducing—a non-refundable tax credit. Under section 12 StaReV, a refundable credit must be used at the earliest opportunity and any unused balance is paid four years after the award becomes final. The handbook models this form on the GloBE qualified refundable tax credit rule and warns that the company bears the risk of a late payment falling outside the 48-month condition. A non-refundable credit is not paid in cash.^[2][4][5]

Transitional applications are due in January 2027

Applications are ordinarily due by 31 January of the contribution year and use the financial year ending two calendar years earlier. Transitional section 13 StaReV extends the 2026 deadline to 31 January 2027; Lucerne also accepts 2027 applications by that date. Applicants file separately for each legal entity, using audited entity-level accounts and evidence connecting expenditure to qualifying activity. MNEs should therefore map Lucerne personnel, assets and outsourced research by entity, quantify overlapping incentives and grants, and select the payment form with their Pillar Two profile in view.^[1][2][5]