Wolfgang and Martha who live in Zurich, Switzerland, have been dating for years and are now thinking about getting married. As a financially sophisticated couple, they
want to think through the tax implications of their potential union.

a. Suppose that Wolfgang and Marta each earn CHf50,000 a year (so their combined income is CHf100,000). Using the personal income tax rates available at: http://taxsummaries.pwc.com/ID/Switzerland-Individual-Taxes-on-personalincome, calculate the total direct federal tax and Zurich cantonal tax they would pay if they remain single, and compare that to the taxes they would pay if they were married and filed a joint return.

b. Now suppose that Wolfgang and Marta both earn CHf25,000 (so their combined income is CHf50,000). Do the same calculations you did in part (a).

c. What differences do you find in parts (a) and (b)? What is the cause of these differences?