The structure of the country leaves much room for competition among different regions. Some of them charge lower tax rates, others offer more favorable business environments. But the cantonal level of taxation system is added to by two additional levels:
Each taxation level may change its rates when there appears to be public pressure or demand within the community. If the need arises to change the rate of a direct or withholding tax of a certain canton, a referendum may be implemented. Its results change the rates directly. This approach is democratic and reflects the right of Swiss residents to take part in all aspects of the country's political and economic life .