In Switzerland, industrial products include intermediate inputs to the production process such as capital goods, raw materials, semi-finished products, machinery and equipment, salt and industrial salt, as well as industrial goods. consumer goods such as vehicles, household appliances, clothes, shoes... These products are in chapters 25-97 of the HS code (except for some products in chapters 35 and 38 which are also considered agricultural products). However, agricultural products, including live animals and plants, food, processed agricultural products, seeds, animal feed, aquatic products... are not considered industrial products. Therefore, import taxes still apply to these products.
In addition to eliminating import taxes on industrial goods, a number of changes were also made to simplify customs tariffs and regulations on proof of origin. For many product types, detailed HS code division due to different tax rates is no longer necessary. Therefore, from January 1, 2024, the number of Swiss HS tax lines will decrease from 9,114 to 7,511.
For example, previously children's leather shoes had HS code 6403.5910 and were subject to a normal import tax of CHF 173 per 100 kg. From now on the tax rate is 0 and they will be grouped with other types in group HS 6403.5900.
The removal of import taxes on industrial goods does not change the customs clearance process. Importers still have to declare imports and pay other fees and charges incurred when importing, including VAT.
The decision to abolish import taxes on industrial goods was made by the Swiss Parliament in October 2021 by amending the Customs Tax Law. At the February 2022 Government meeting, the Swiss Government decided that this measure will take effect on January 1, 2024. With this measure, Switzerland, as a highly open economy, is sending a clear message to support and promote open trade, in the context of a global trade environment. Demand is increasingly protectionist. The Swiss government will review the impact of this policy on domestic prices of relevant products through a monitoring program.
During the preparation process, the Swiss Government conducted studies on the impact of abolishing import taxes on industrial goods. The benefits to the economy are estimated at CHF 860 million (about USD 1 billion) based on 2016 trade figures. This includes about CHF 490 million in direct tax savings for businesses and approximately CHF 100 million in savings from reduced administrative costs. Added to this are indirect impacts, such as increased productivity for businesses, estimated to be worth around CHF 270 million.
Based on updated 2022 figures for Swiss imports, direct tax savings for businesses could amount to around CHF 600 million (USD 680 million). The Swiss government has not introduced any direct measures to compensate for the loss of customs duties following the abolition of import duties on industrial goods. According to preliminary studies, the removal of import duties on industrial goods is expected to increase economic output and thereby indirectly increase other tax revenues, offsetting about 30% of the loss in customs tax revenue. important in the coming years. Looking at the Swiss economy as a whole, the positive effects will be significantly larger than the expected tax revenue loss.
According to experts, this invitation policy contributes to reducing the financial and administrative burden for both Swiss businesses and consumers, thereby improving Switzerland's position as an economic, trade and economic center. industry. It helps Swiss industry have easier access to raw materials and input products, with greater competitiveness and diversification. Thereby contributing to improving the productivity and competitive efficiency of Swiss companies, both domestic and foreign.
In fact, Switzerland has always advocated opening the door to industrial products even before officially abolishing import taxes on industrial goods. Import taxes on most industrial goods are inherently low, or zero, especially for countries enjoying GSP tax incentives (including Vietnam) and LDCs. There are only a few products, especially in the textile and garment group, that have quite high import taxes. However, overall, import taxes from industrial goods only account for a very small proportion of the import turnover of industrial goods, which accounts for 90-95% of Switzerland's total import turnover each year. This can be seen through the industrial goods import tax revenue in 2022, estimated at about CHF 600 million, out of a total industrial goods import turnover of CHF 280.1 billion. Thus, import tax on industrial goods accounts for about 0.21% of Switzerland's industrial goods import turnover.

For Vietnam, according to data from Swiss Customs, industrial goods on average account for about 90-93% of the country's total annual import turnover from Vietnam. Many of these products enjoy Swiss GSP tax incentives. The abolition of Swiss industrial goods import tax will make Vietnam's products equal to all other countries, with no advantage (for example compared to countries that do not enjoy GSP) or disadvantage (for example limited compared to LCD countries) on taxes. For some products such as textiles, footwear, etc., Vietnamese products will benefit more than competitors in the LCD group of countries.
Source: Vietnam Trade Office in Switzerland