As of 1 January 2024, Switzerland will abolish its industrial tariffs on the import of industrial goods. This measure will apply to goods in chapters 27 to 97 of the Customs tariff, with the exception of some products in chapters 35 and 38 which are classified as agricultural products.
Removing industrial tariffs will strengthen Switzerland’s position as a strong business and industrial location. The potential welfare gains are estimated at some CHF 860 million. Whereas customs duties used to protect domestic industry from foreign competition, today they make it more expensive to procure materials from abroad. With the removal of customs duties and the associated simplification of administrative procedures, Swiss businesses will benefit from cheaper inputs and thereby also from lower production costs. Given that the Swiss economy is highly integrated in global value chains, this will also improve its international competitiveness. Trade ties will become more efficient overall and competition will improve. Consumers should also benefit from the measure as import duties are still currently levied on various consumer goods such as cars, bicycles, personal care products, household appliances and clothing. In sectors with functioning competition, the savings will be passed on to consumers. On the other hand, Switzerland will no longer have much to offer on tariff reductions or abolishment in free trade agreements, several of which are currently under negotiations.
In addition to the lifting of industrial tariffs, the bill provides for a streamlined tariff structure for industrial products, which will further reduce the administrative burden.
Rules of origin
As a result of the abolition of industrial tariffs for goods under chapters 25 to 97 of the customs tariff, the following rules will apply from 1 January 2024:
- No proof of origin required as preliminary document: when it is already known at the import stage that the goods will be staying in Switzerland.
- Proof of origin required as preliminary document: when the goods are to be exported to a free trade partner state and the corresponding proof of origin is to be generated for them upon export.
This measure had been proposed for many years now, and its adoption came somewhat as a surprise, but had not been challenged, primarily as an expression of Switzerland’s overall economic interests.
