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Switzerland Lowers Customs Duties For Textiles

Friday, May 10, 2019

The Swiss Federal Council has approved an Ordinance on the Temporary Suspension of Customs Duties on Textile Input and Intermediary Materials, which will enter into force on July 1.

The Council said that Switzerland's highly specialized textile industry relies on imports of input and intermediary materials for its production processes. It explained that the taxes on these products are considerably higher in comparison to input materials for other industries.

According to the Council, the high duty rates were originally intended to protect the domestic textile industry but are now having a detrimental effect.

Under the Customs Tariff Act, the Federal Council can, in the interests of the Swiss economy, order the temporary suspension of customs duties applicable to certain goods.

In January 2016, the Federal Council temporarily reduced customs duties under 60 tariff headings to CHF0. The current measure extends the existing tariff suspension and its scope to a total of 522 tariff headings. The Council is responding to a request from the Swiss textile association to suspend customs duties on all textile input and intermediary materials.

The Federal Council expects these measures to reduce customs revenues by around CHF3m (USD2.95m) a year. However, it also expects the reliefs to have a positive effect on the economy as a whole.