Bern Authorities Call for Increased Military Spending

The Swiss government has requested that parliament approve 3.4 billion Swiss francs, approximately $4.32 billion, in defense spending to expand the country’s ground-based aerial defenses, cyberspace capabilities, and protection against drones.

The request, made on March 20, 2026, is intended to strengthen the defenses of the neutral nation against threats identified as the most likely following the invasion of Ukraine by Russia. According to a government statement, the military must be more strongly oriented toward defense to counter hybrid conflicts and long-range attacks.

Aerial Defense and Military Priorities

A significant portion of the requested funds is earmarked for the procurement of German-made IRIS-T SLM missile systems, which would cost 1 billion Swiss francs. The government has allocated approximately 70 million Swiss francs to increase protection against mini-drones.

Defense Minister Martin Pfister stated during a news conference on March 20, 2026, that Switzerland is currently not sufficiently protected against the most likely forms of threat. As part of this strategic shift, Pfister noted that the renewal of vehicle fleets has become a lower priority for at least the next three years compared to the newly defined threats.

Proposed VAT Increase for Rearmament

To fund the broader rearmament of the Swiss Armed Forces, Federal Councillor Martin Pfister has proposed a temporary increase in the Value Added Tax (VAT). On January 28, 2026, the Federal Council decided to seek a VAT increase of 0.8 percentage points for a limited period of ten years, beginning in 2028.

This funding mechanism is projected to provide the army with an additional 2.7 to 3 billion Swiss francs annually. While the center supported the plan, other political parties have rejected the proposal.

The use of VAT to finance a security policy project represents a break from previous Swiss government practice. Since its introduction in 1995, VAT increases have been used primarily to fund infrastructure and social services, including disability insurance, the AHV (old-age and survivors’ insurance), and the New Rail Link through the Alps (NRLA), the largest construction project in the history of Switzerland.

Geopolitical Context and Neutrality

The push for increased military spending comes amid a heightened global security environment. The Swiss government explicitly linked the need for these upgrades to the security situation following the Russian invasion of Ukraine.

In light of the heightened security situation, the military must once again be more strongly oriented toward defence, and countering the most likely threats – long-range attacks and hybrid conflicts – must be strengthened

Swiss Government Statement

On March 20, 2026, Switzerland also announced that it had halted weapons exports to the United States. The government cited its neutrality as the reason for this decision, specifically pointing to the U.S.-Israeli war on Iran.