Major Tariff Changes
- Base tariff raised from 10% to 39% on most Swiss imports, effective August 7, 2025 at 6:01 a.m., with exceptions for select sectors like pharmaceuticals, precious metals, and electronics.
- The 39% tariff is additive—it applies on top of existing product-specific tariffs that were in place before April 7, 2025.
- Tariffs apply indefinitely, unless a bilateral agreement is reached between the U.S. and Switzerland.
Economic Impact on Swiss Exports
- Heavily affected sectors include watches (CHF 5B), precision instruments (CHF 3.7B), mechanical devices (CHF 3B), and food products like coffee and spices.
- Pharmaceuticals face future risk: a potential 100% tariff in 2026 and price reduction mandates by September 29, 2025 for new and existing drugs.
- Semiconductors and processed goods (e.g., automotive parts) may face further restrictions, with rules of origin under the US-EU agreement playing a key role.
Shift Toward U.S. Operations
- Recent U.S. corporate tax cuts (announced July 4, 2025) make domestic production more attractive:
- Full tax deductibility for facilities built between Jan 2025–Jan 2029 and operational by Dec 2030.
- Full deductibility for U.S.-based R&D, incentivizing relocation of innovation hubs.
Source Mathias Bopp
