Some 52.9 percent of voters, more than 216,000 people, approved an initiative by the left-wing Alternative List to abolish "tax privileges for foreign millionaires" in the canton.

It was the first time that the group won a referendum in Zurich, the home of Switzerland’s secretive and conservative banking and finance establishment.

The result obliges cantonal authorities to change local tax laws.

The tax break helped draw dozens of international sports, entertainment and business celebrities to Switzerland. In Zurich, 137 people benefited from the deal in 2006, the Swiss news agency ATS reported.

In several cantons, wealthy foreigners are able to negotiate a confidential tax fee with local authorities instead of paying income tax, provided they do not work in Switzerland.

However, the practice often caused controversy in the home countries of some of the celebrities, amid accusations of tax evasion.

Unease also grew in Switzerland recently, not least because some of their own stars, such as top tennis player Roger Federer, could not enjoy the same deal.

Famous foreign residents in Zurich include US singer Tina Turner and Russian oligarch Viktor Vekselberg.

Other celebrities residing in Switzerland in 2008 included motor racing champions such as Lewis Hamilton, Fernando Alonso, Kimi Raikonnen, Michael Schumacher and Sebastien Loeb, singers Shania Twain and James Blunt, and business magnates.

After arguing that the tax privilege was unfair, the Alternative List said it hoped the outcome would send a signal to the rest of Switzerland.

[AFP / Expatica]