Oil trader Vitol could move its headquarters from Geneva if Switzerland increased taxes on big commodity traders, and others would do the same, said the company's managing director.

"We could - and we wouldn't be the only ones - move the domicile of our assets elsewhere," David Fransen told Swiss weekly magazine L'Hebdo in an interview.

Switzerland has come under pressure from the European Union to end so-called "fiscal holidays", including those which the canton of Geneva offers to major trading firms such as Vitol, Mercuria and Gunvor.

Geneva has proposed a flat 13 per cent corporate tax rate for trading houses, signifying a rise from the 11.6 per cent paid by the big firms but a cut for companies that do not qualify for special tax breaks, who currently pay 24.2 per cent.

Since the reform would leave a 460 million franc ($511 million) hole in the canton's budget, Geneva has said it cannot guarantee the reform will get through.

Fransen said Vitol could live with a 13 per cent tax rate but Switzerland would suffer greatly if it doubled the tax rate on big Geneva-based trading firms such as Vitol.

Vitol is privately held and does not publish detailed financial accounts. But Fransen said its gross margin on sales of $303 billion was "much less" than 1 per cent.

Geneva is the hub for a third of the world's physical oil traded volumes, according to the Geneva Trading and Shipping Association. For Switzerland as a whole, the commodity sector accounts for around 3.5 per cent of gross domestic product and employs around 10,000 people.

In April the co-owner of Gunvor, Gennady Timchenko, said the trading house could move to Singapore, a rival trading hub, if Switzerland became less attractive. However, Timchenko said he was confident a solution would be found and added the company was not looking to move.

Most global commodity firms already have branches in Singapore, which can offer tax rates as low as five to 10 per cent through its Global Trader Programme.

Vitol has been happily based in Geneva for 47 years but Switzerland was gradually accumulating disadvantages, such as the cost of living, while Dubai, Singapore and even the UK offered competitive tax regimes, Fransen said.

The slow pace of Swiss reforms, with a new tax regime expected only in 2018 or 2020, ensures that companies have the stability and long-term visibility that they need.

"But be careful not to take too long: some countries, like Singapore, are making great efforts to attract new companies and exploit the uncertain times that come with reforms."-Reuters