Chocolate, skincare & timepieces: What 39% tariffs on Swiss goods mean for U.S. Consumers.
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Introduction
Starting August 7, 2025, the U.S. government will impose a 39% tariff on most Swiss exports a move designed to address a large bilateral trade imbalance. This measure is among the highest ever imposed by the U.S., and stands in contrast with more favorable rates given to other trading partners like the EU (15%) or the UK (10%).
What is the 39% Tariff?
It is a punitive import duty triggered by a rising U.S. goods trade deficit (around $38.3–48 billion in 2024, depending on source).
Exemptions: Pharmaceuticals and medical devices are currently excluded, though further scrutiny could raise duties later.
It applies to a broad array of Swiss goods: luxury watches, chocolates, skincare, jewelry, and certain consumer products not produced or assembled in the U.S..
Advantages and benefits on 39% tariffs on Swiss goods mean for U.S. consumers
Incentive for domestic production and competition
A steep 39% tariff makes imported Swiss goods much more expensive, which encourages U.S. distributors and retailers to source from domestic or local manufacturers. This shift can drive investment in U.S. manufacturing, support job creation, and foster competition. As a result, some consumers may see more U.S.-made alternatives become available at competitive prices as companies try to avoid the high import costs.
Better-tailored lower-priced alternatives
With Swiss imports facing significantly higher prices, affordable alternatives including pre-owned luxury items or domestic mid-tier brands become more appealing. For example, the secondary market for pre-owned Swiss watches, which are not subject to the tariff, is expected to grow, offering accessible options for consumers not wanting to pay a 39% premium.
Promotion of conscious and sustainable consumption
As many observers from the Swiss chocolate industry note, rather than buying less expensive volume chocolates, consumers may choose to purchase fewer, higher‑quality products and enjoy them more mindfully. Aware of price increases, customers might focus on savoring premium chocolate intentionally leading to a more sustainable and experience-oriented consumption pattern.
Niche growth and innovation among brands
U.S. skincare and beauty brands that replicate Swiss skincare principles or offer Swiss‑descended quality but produce locally may gain traction. Tariffs may spur innovation in domestic beauty, creating options that capture the prestige of Swiss skincare without its import cost. U.S. producers could invest in premium positioning to fill the vacuum.
Potential leverage for future negotiation
The U.S. has placed Switzerland among the highest‑tariffed nations, which while painful provides leverage in negotiations. If Switzerland agrees to concessions (e.g., U.S. LNG purchases or investment in U.S. projects), it may reduce the tariff rate. A reduced tariff could eventually translate into lower prices or restored access to Swiss-made goods benefiting consumers over time.
Stimulus for educational transparency
Since many Swiss‑origin items will now be notably more expensive, U.S. retailers may start labeling origin more clearly e.g. “Swiss‑made versus made in U.S.” This helps consumers make more informed decisions about value, origin, and craftsmanship. Before, origin tags might have been overlooked; now, they may inform shopping choices more actively.
Pros (for U.S. Stakeholders) and Consumer Impacts
Impact on Swiss Watches (Timepieces)
U.S. was Switzerland’s largest watch market, with ~$5.4 billion in exports in 2024. Tariffs likely push retail prices sharply up: e.g., Rolex Submariner might increase from ~$10,000 to nearly $14,000 in the U.S.. Consumers may shift to the pre‑owned secondary market, which could rise 10–35% in price, being unaffected by duties. Retailers face tough choices: absorb costs or pass them on; both outcomes squeeze margins or reduce demand.
Effects on Swiss Chocolate
Swiss SMEs (small‑medium enterprises) export ~7% of Swiss chocolate to the U.S.. Effective cost increases for these firms could reach ~50% when combined with currency shifts ($1 ≈ 1.23 CHF). They’ll likely pass most of the tariff to U.S. consumers, leading to higher retail prices. Multinationals like Lindt and Nestlé can offset more easily using U.S. production lines, but artisanal Swiss brands cannot they may suffer sales drops or withdraw from U.S. markets.
Impact on Skincare & Beauty Products
Swiss beauty brands (e.g. La Prairie, Valmont, Mavala) pride themselves on Swiss-made provenance; tariffs would raise retail prices significantly. Companies less tied to Swiss manufacturing (e.g. Galderma/Cetaphil) may see limited impact. 39% tariffs vastly exceed typical duty levels (10–15%) that brands can absorb without harming margins or demand.
Cons & Drawbacks (for Consumers)
Higher Consumer Prices: Importers pass tariffs along likely adding 40–55% to sticker prices.
Reduced Choice: Small Swiss brands may stop exporting, limiting product variety in U.S. stores.
Inflation Pressure: Tariffs drive up overall inflation by increasing costs on imported goods, sometimes beyond the tariff itself due to margin maintenance policies.
Supply Disruptions: Retailers may delay launches or reorder patterns, causing longer wait times for premium Swiss goods.