Switzerland's traditional position is one of well-armed military neutrality, but Russia's war in Ukraine reopened questions over its non-engagement in foreign conflicts.
Fearing the position might slacken, the sovereigntist organisation Pro Switzerland collected enough signatures to trigger a public vote on better anchoring neutrality in the country's constitution.
The initiative aims to restrict non-military measures such as sanctions, to prevent any closer ties with NATO and to rule out any military alliance except if attacked.
"Enshrining a rigid understanding of neutrality in the federal constitution is not in Switzerland's interests and would restrict its room for manoeuvre in foreign policy terms," the government said in a statement.
"This would mean that sanctions could no longer be imposed on belligerent states outside the UN and cooperation with military or defence alliances would be severely curtailed," it said.
A flexible application of Swiss neutrality had served the country well and was crucial to safeguarding its interests, it said.
It said security and defence cooperation would be "severely restricted, thereby weakening Switzerland's defence capabilities" with such a move to tighten its neutrality rules.
While the government believes cooperation with defence alliances is in Switzerland's interests, it noted that joining any such alliance is already prohibited.
Bern also said it was in Switzerland's interests to support broad-based international sanctions.
The government recommended that parliament should reject the initiative.
Under Switzerland's direct democracy system, citizens can trigger popular votes by collecting 100,000 valid signatures within 18 months.
The "Safeguarding Swiss neutrality" popular initiative was submitted in April. No date has yet been given for when the vote might take place.
Switzerland has refused to send arms to Kyiv or allow countries that hold Swiss-made weaponry to re-export it to Ukraine.
However, it has matched the neighbouring European Union's economic sanctions on Russia since the February 2022 full-scale invasion of Ukraine.
The vote proposal calls for the constitution to guarantee that Swiss neutrality is "armed and perpetual" and applied "permanently and without exception".
Sanctions would also be prohibited, except when decided upon by the United Nations.
Swiss neutrality traces its roots back to 1516 and has been internationally recognised since 1815.
All men are obliged to do military service and attend refresher courses for years afterwards.
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