Donald Trump has increased the US tariff rate for Swiss imports: Stefan Legge, an expert on international trade, explains in an interview.
interview
Donald Trump has wielded the tariff hammer again. An HSG trade researcher explains in an interview what the new sentence means for Switzerland.
July 24, 2026, 4:07 p.mJuly 24, 2026, 4:30 p.m
Mr. Legge, US tariffs on imports from Switzerland will rise from 10 to 12.5 percent, although there are exceptions for certain products. Is this bad news because the tariff rate is increasing or good news because the increase is moderate?
Stefan Legge: Both a little. At least the tariff rate for Swiss companies remains roughly the same. The best news is certainly that the increase was no surprise. It corresponds to the announcements of US Trade Representative Jamieson Greer. Companies need stable rules so that they can plan their operations in the long term. But of course: the tariffs are still higher than before, which many companies don’t like.
In contrast to Switzerland, the EU is allowed to keep its tariff rate of 10 percent. Swiss business associations are bothered by this because it allows neighboring companies to deliver cheaper to the USA. How serious is this disadvantage for Swiss companies?
This depends on the industry and who the respective companies are competing with. It won’t matter much to Swiss watch manufacturers if they have slightly worse customs conditions than their counterparts in Germany because their customers are already willing to pay more. Manufacturers of machines and precision instruments are likely to be particularly affected. They have strong competition from the EU and have comparatively low margins on their products, i.e. lower profits per product. If they have to add a price markup because of additional tariffs, that can eat into their profits very quickly.
To person
Stefan Legge is a lecturer in economics at the University of St.Gallen. He heads the tax and trade policy department and is also deputy director of the Institute for Law & Economics. His dissertation was awarded the prize for the best dissertation in economics in 2016. Legge researches international trade and political economy. (here)
How do you explain Switzerland’s disadvantage?
It is difficult to pinpoint specific reasons. Trump’s tariff policy follows no apparent logic. These are individual sensitivities and daily form that are ultimately decisive. There is an example that illustrates very well how chaotic Trump’s tariff policy is in comparison.
Which?
Under Donald Trump, the USA has adjusted its tax policy. During his first term in office, he ensured that companies had to pay significantly less taxes. It was primarily experts who implemented his specifications. And they did it cleverly: They aggressively but systematically reduced taxes to benefit the interests of large American corporations, and Trump let them do so. But when it comes to tariffs, he gets involved in the details and always has the last word. You can see that too. Its tariffs are neither legally well secured nor strategically implemented.
In addition to Switzerland, the Trump administration has also punished other countries with tariffs. Reason: They didn’t do enough against forced labor. What do you think of this argument?
The reasoning is of course outrageous and pretextual. As if Trump were interested in people in forced labor. The point is that he wants to enforce his tariff policy, for whatever reasons. As was the case a year ago, he has no real legal authority to do this. Customs duties and taxes are actually a matter for Parliament. Accordingly, Trump’s lawyers are looking for any old laws that allow the president to take certain actions in exceptional situations.
“The reasoning is of course outrageous and pretextual.”
Do you expect lawsuits to come in and the Supreme Court to overturn the new tariffs, as it did with Trump’s punitive tariffs at the beginning of the year?
There will definitely be complaints. These tariffs are very painful for individual companies. I don’t currently dare to assess whether this will be legally successful.
Have Federal President Guy Parmelin and Seco boss Helene Budliger acted correctly in the customs dispute so far?
I am standing up for those responsible in Bern who are working intensively to achieve good results for Switzerland. Your job is extremely difficult. On the one hand, they have to keep Switzerland and its concerns on Trump’s radar, but at the same time they must not anger him. You can talk to a lot of people in the Trump administration, but in the end everything depends on the president’s decision. My impression is that they got out what they could get out of it. Precisely because there is a long list of exceptions for certain industries, for example the pharmaceutical industry.
Seco boss Helene Budliger Artieda and Federal President Guy Parmelin tried to get a lower tariff rate from US Trade Representative Jamieson Greer (right).Image: KEYSTONE
The next additional tariffs are already looming on the horizon: In an investigation, the USA accuses several countries of deliberately creating artificial overcapacity. Do you expect a further increase?
It is conceivable that there will be another surcharge. Despite tariffs causing him defeats in court and inflation, Trump simply won’t let go of the issue. Surprisingly, he has met with great approval among his electorate. Switzerland will still be concerned about US tariffs regardless of this investigation. Trump has announced that he wants to impose a 100 percent tariff on generic drugs from 2028. And there are still enough supposed legal bases for new tariffs. The approaching end of his time as president could also play a role.
How?
The midterms may be lost. This means that Trump’s power is waning in the future. If there’s one thing he doesn’t like, it’s that his power and prestige are diminishing. A Trump in this situation lashes out and resorts to the means he prefers. And those are tariffs. Just last year it became clear that he was using the tariffs to show himself as a powerful man. When he imposed high tariffs on numerous countries, presidents from all over the world had to come to him and ask for a lower tariff rate. I’m convinced Donald Trump thought that was great.
“In Washington, a Swiss free trade agreement with the USA would have no chance.”
Swissmem, the association of the Swiss technology industry, is hoping for a trade agreement with the USA. Currently there is only a non-binding commitment from the USA not to set tariffs above 15 percent. But does a trade agreement actually offer any protection against Trumpian arbitrariness?
No, that’s an illusion. The USA has a trade agreement with Mexico and Canada. Trump even negotiated this himself in his first term in office. Look what happened this week: Trump announced new tariffs of 50 percent for Canada. Their free trade agreement with the USA hasn’t helped the South Koreans much either. I spoke about this with Edward McMullen, then the US ambassador to Switzerland, during Trump’s first term. He was in favor of such an agreement, but it would have no chance in Washington.
Switzerland has shown itself to be a model student for Trump: Swiss companies have announced major investments in the USA. To this end, Switzerland promised in a declaration of intent to adopt certain US standards in the areas of medicine and passenger vehicles. Was this journey worth it?
Overall, this approach has required relatively few concessions from the Swiss and their companies. Many companies had planned new locations in the USA and are now simply putting these investments more in the shop window. The declaration of intent does not yet have any concrete effects. Bern is trying to maintain relations with the USA under difficult conditions. And overall it works relatively well.
EDA head Ignazio Cassis said not long ago that “muddling through” was a core Swiss competency. Given Trump’s unpredictable customs policy, will Switzerland simply have to muddle through his second term in office?
Yes, but you shouldn’t just muddle around. It takes a strategy. The Federal Council must consider what political priorities should apply to the USA. To be fair, finding a clear strategy against Trump’s unpredictable actions is difficult. If Trump’s tariff policy had one good thing, perhaps it was that it was a wake-up call for Switzerland. We have to learn to deal with unexpected things, especially since there could be even more geopolitical rumbles in the next few years.