In the early 2000s, Vaud's finances were emerging from a long run of deficits. To consolidate the books, the cantonal government — with Pascal Broulis (FDP/Liberal-Radical) as finance minister and the newly elected Pierre-Yves Maillard (SP) — proposed a package of targeted tax increases, together with a new law on nursing homes (EMS).
Five measures went to the people on 17 April 2005: a property-gains tax, an extraordinary wealth tax, an extraordinary expenditure tax (lump-sum taxation), a cut to the savings-interest deduction, and the EMS law. The centre-right and business circles launched the referendum.
The verdict was emphatic: all five measures were rejected, from the property-gains tax (61.5 % No) to the EMS law (76.2 % No), on a turnout of about 35 %. Vaud voters said no to tax rises — and the future would largely prove them right.
▲ The Yes camp (defeated) The government, the Social Democrats and the left defended « targeted » increases to fund schools, nursing homes and hospitals. All measures are rejected. | ▼ Five measures, five rejections (17.04.2005) Property gains: 61.5 % No — Extraordinary wealth tax: 64.7 % — Extraordinary expenditure tax: 52.2 % — Savings-interest deduction: 68.3 % — EMS law: 76.2 %. |
The players
▲ Yes camp (for the increases) • The cantonal government as a body, including Pascal Broulis (FDP, Finance) and Pierre-Yves Maillard (SP) • The Social Democratic Party, the Greens and the unions • Defenders of public services (schools, nursing homes, hospitals) | ▼ No camp (referendum committee) • The centre-right (Radicals/Liberals, SVP) and business circles • Taxpayer and business-defence associations • Opponents of any tax rise — including the base of the finance minister's own party |
Arguments and verdicts
▲ Arguments FOR (Yes camp) Without this revenue, public services will suffer « schools, nursing homes, hospitals and subsidies will pay for a No » Verdict: ✗ Disproved by the facts. The announced cuts never materialised: from the mid-2000s the Vaud books recovered and the canton strung together budget surpluses under the Broulis era. Source: Le Temps; cantonal accounts A « reasonable », targeted fiscal effort « the effort asked of Vaud taxpayers is reasonable » Verdict: ✗~ Judged unnecessary — by voters and by hindsight. Voters refused the effort, and the trajectory of cantonal finances vindicated them: the canton balanced its books without these rises, then even cut taxes (tax shield 2009, corporate-tax reform 2016). Source: Le Temps | ▼ Arguments AGAINST (No camp) The canton can balance its books without new taxes « savings rather than tax rises » Verdict: ✓ Confirmed. The 2005 budget already planned CHF 200 million in savings; the following years closed in surplus, bearing out the case for recovery without heavier taxation. Source: Le Temps; cantonal accounts Too much tax harms the canton's appeal « do not penalise taxpayers and businesses » Verdict: ✓~ Broadly confirmed. Vaud went on to become more tax-competitive (the 2016 corporate-tax reform passed overwhelmingly). Caveat: the 2009 tax shield was criticised for applying too generously to high earners. Source: Le Temps; 24 heures |
The record, in figures
✗ 5/5 tax measures rejected on 17.04.2005 | ✗ 76.2% No on the most rejected (EMS law) | ~ ~35% turnout | ✓ Surpluses cantonal finances recovered in later years — without the rises |
17 April 2005 staged a Vaud classic: a government demanding a fiscal effort to balance the books, and an electorate flatly refusing. The piquant twist: it is the centre-right — finance minister Pascal Broulis's own political family — that led the referendum against the government's package.
The rejection was sweeping and uniform: all five measures fell, from the closest (expenditure tax, 52.2 % No) to the most decisive (EMS law, 76.2 %).
Events vindicated the opponents. Far from the predicted asphyxiation, cantonal finances recovered and the canton piled up surpluses — even cutting taxes in the following decade. The Yes camp's fears did not come to pass.
One caveat remains: fiscal restraint sometimes tipped into generosity. The tax shield adopted in 2009 was criticised — and even triggered a legal dispute — for cutting the wealthiest's taxes too far. On 2005, however, voters had it right.