Swiss Federal Supreme Court, 16.12.2025, 9C_398/2025
Facts
The Zurich Cantonal Council has issued a new directive ("Weisung 2026") regarding the valuation of real estate and the determination of imputed rental value starting from the 2026 tax period. This directive provides for an average increase of 48% in real estate tax values and 10-11% in rental values.
Two property owners and the Zurich Cantonal Homeowners' Association challenged this directive directly before the Cantonal Administrative Court, seeking its annulment. The Administrative Court dismissed the case, classifying the directive as an administrative ordinance with external reach that is not subject to direct appeal. It held that its legality could be challenged later, on a prejudicial basis, as part of an appeal against an individual tax assessment. The appellants brought this dismissal decision before the Federal Supreme Court.
In the meantime, a federal vote resulted in the future abolition of the taxation of imputed rental value, which led the Zurich Cantonal Council to issue transitional provisions.
Legal Analysis
The Federal Supreme Court reiterates the distinction between a normative act (or "enactment" within the meaning ofArt. 82 let. b LTF), which is subject to abstract judicial review, and an administrative ordinance. A normative act contains general and abstract legal rules that create rights and obligations for citizens. An administrative ordinance is, in principle, an internal instruction for the administration.
Exceptionally, an administrative ordinance may be subject to a direct appeal if three cumulative conditions are met:
- It has external effects, meaning it directly or indirectly affects the legal situation of citizens.
- Citizens cannot subsequently obtain an appealable decision that would allow them to challenge the compliance of the ordinance effectively and reasonably (prejudicial review).
- The appellant has a virtual interest in the annulment of the act.
The Federal Supreme Court refers to its established case law regarding previous Zurich directives on real estate valuation, which it has consistently classified as administrative ordinances.
Application to the case
The Federal Supreme Court classifies the "Weisung 2026" as an administrative ordinance. Although it is based on a legal delegation (§ 39 of the Zurich Tax Act), it contains highly detailed technical rules intended primarily for tax authorities to ensure a uniform and schematic valuation of hundreds of thousands of properties in the canton, taking into account numerous individual criteria (location, age, condition, etc.).
The Federal Supreme Court acknowledges that the directive has clear external effects, given the significant financial impact on property owners (condition 1 met).
However, it finds that the second condition is not met. Each property owner will receive an individual tax assessment based on this directive. They will be able to challenge this decision through ordinary appeal channels and, on that occasion, raise the illegality of the underlying directive (prejudicial review). The Court deems this path of appeal reasonable ("zumutbar"), as the valuation of each property involves numerous individual aspects that are better suited to a concrete examination than an abstract review. The possibility for the tax administration to handle "pilot cases" addresses concerns related to procedural economy.
The upcoming abolition of the rental value tax makes an immediate abstract review of this part of the directive all the less necessary. As the conditions for a direct appeal against an administrative ordinance have not been met, the lower court was correct in its decision not to consider the case.
Outcome
The Federal Supreme Court has dismissed the appeal. It upholds the decision of the Administrative Court of the Canton of Zurich. The appellants shall bear the legal costs.
Silex tax newsletter published in collaboration with Anna Vladau, Attorney at Law
