Switzerland: Elimination of tariffs on industrial goods effective 1 January 2024

Switzerland will unilaterally eliminate import duties on almost all industrial goods effective from 1 January 2024. 

The average cost of goods and services is considerably higher in Switzerland than in neighboring countries. One of the factors contributing to the country’s high-cost status is the presence of various tariff and non-tariff trade barriers that isolate the Swiss market, allowing companies to charge higher prices domestically. With the aim of reducing these trade barriers, the Swiss Federal Council adopted a package of import facilitation measures back in December 2017. One of these measures was the elimination of tariffs on industrial goods, which has now been adopted and will enter into force on 1 January 2024.

• Swiss industrial duty rates will be set to zero for most industrial products (covered in HS-chapters 25 – 97) such as mineral products, chemicals, plastics etc., but also consumer goods such as bicycles, cars, household appliances, clothing and footwear. Starting from 1 January 2024, these products will no longer be subject to customs duties when imported into Switzerland, regardless of their origin.
• The current Swiss tariff structure will be simplified, by combining and reducing the number of tariff lines. The total amount of different tariff numbers will be reduced from 9,114 to 7,511. In most cases, this simplification involves replacing the last two digits of the Swiss eight-digit tariff numbers with "00". As such, tariff classification in Switzerland should be easier for companies going forward.

The elimination of industrial customs duties does not mean that companies no longer need to worry about preferential proofs of origin when importing industrial products into Switzerland. For now, such preferential proofs of origin are often needed to benefit from a lowered or zero customs duty when importing goods into Switzerland, on the basis of a free trade agreements (FTAs) or the Generalised System of Preferences (GSP) in favor of developing countries.

As of 1 January 2024, such proof is no longer required if it is clear at the time of importation that the goods will remain or be consumed in Switzerland and are already subject to a zero-duty rate. 

With 1 January 2024 fast approaching, companies need to proactively prepare for the changes to take advantage of the benefits. Key things to consider include:

• Calculate and quantify the expected savings resulting from the elimination of industrial tariffs. Understanding the financial implications is essential for effective planning and resource allocation.
• Incorporate the updated master data (e.g., tariff codes, origin calculation) into your systems to provide seamless compliance going forward.
• Provide that suppliers continue to provide proof of origin and that customs agents continue to report such when necessary.
• Swiss companies need to evaluate and assess the potential implications of this reform on their supply chain and customs operations. This includes examining how the changes could affect sourcing strategies and logistics.

Read a September 2023 report prepared by the KPMG member firm in Switzerland