A decision by Switzerland to unilaterally abolish import duties on almost all industrial goods could come into force as early as 1 January 2022 or during the first quarter of 2022.
The decision aims to tackle the high prices of goods to consumers while simplifying the Swiss customs tariff for traders.
According to EY, if a final parliamentary vote goes through in favour of the move, the Swiss tariff code would be downsized from 6,172 tariff lines to 4,592.
The elimination of customs duties and tariff code changes would also both enter into force on the same date.
Although ending customs duties on industrial imports should simplify imports, cumulation of goods could be a problem.
If raw materials or semi-produced goods are imported from outside of Switzerland and go through further production processes in the country before being re-exported as a final product, there could still be a requirement for the Swiss producer to prove that such goods are of preferential origin, which would put further onus on the producer to collect evidence of origin from its supplier.
EY warns that companies should be aware of other developments too.
With the EU planning to implement ‘green taxes’ on plastics or carbon emissions, Switzerland may follow suit and could tax imports based on sustainability and environmental aspects.
According to the DIT, trade between the UK and Switzerland was worth £30.9bn in the four quarters to the end of Q2 2021. The UK has a £5.8bn trade surplus with the Swiss.
Switzerland was the UK’s 10th largest trading partner in the four quarters to the end of Q2 2021 accounting for 2.5% of total UK trade.