The United States has taken a significant step that could disrupt the global gold market by imposing tariffs on one-kilogram and 100-ounce gold bars. These bars, commonly used in international trade, have now been reclassified under a tariff-imposing customs code by the U.S. Customs and Border Protection (CBP), according to a recent ruling issued on July 31. This reclassification has sparked uncertainty and concern in the bullion trade, particularly for Switzerland, which serves as the world’s largest hub for refining and exporting gold.
Previously, industry participants believed that these specific gold bar sizes were exempt from duties based on an alternate customs classification. The new ruling, however, places them under a code that subjects them to tariffs. This decision contradicts longstanding expectations and has caused ripple effects across markets and supply chains.
The bars in question—especially the one-kilo bars—are among the most commonly traded forms of gold in the U.S. financial markets, especially on Comex, the largest gold futures exchange globally. They make up the majority of gold exported to the U.S. from Switzerland, whose refineries typically remelt large London-standard 400-ounce bars into kilo bars for U.S. clients. These kilo bars, roughly the size of a smartphone, differ from the brick-sized bars preferred in London and have become essential to the triangular trade flow between London, Switzerland, and New York.
As a result of the CBP’s new interpretation, the December gold futures contract surged to record highs, fueled by the anticipation of supply disruptions and higher import costs. The spike came shortly after the ruling was revealed, indicating strong market sensitivity to the tariff change. The gold futures price increase also widened the premium of U.S. contracts over London spot gold, signaling growing concern among traders and investors.
The new classification falls under code 7108.13.5500, which is subject to import duties. Previously, the industry operated under the assumption that these bars qualified for the tariff-free code 7108.12.10. That belief led many traders to assume that the goods were shielded from former President Trump’s tariffs, which targeted multiple countries with sweeping trade restrictions.
This unexpected policy shift has intensified tensions between Washington and Bern. Just days before the CBP’s ruling, the U.S. government had already announced a 39% tariff on Swiss imports as part of a broader trade dispute. These moves come at a time when Switzerland had become increasingly reliant on its gold exports to the U.S., which represent a large share of its trade relationship.
In the past year alone, Switzerland exported more than $60 billion worth of gold to the United States. Under the new 39% tariff regime, nearly $24 billion worth of those goods would now face additional duties—substantially increasing costs for importers and possibly reducing the competitiveness of Swiss refiners in the American market.
Industry leaders in Switzerland are reacting with concern. The head of the Swiss Association of Manufacturers and Traders of Precious Metals has labeled the new tariffs as another serious setback for the nation’s bullion industry. He noted that meeting U.S. demand under these conditions would now be much more challenging. Several Swiss refineries have responded by suspending or scaling back their gold shipments to the U.S., citing a lack of clarity in tariff classifications and legal uncertainty. Some have even consulted lawyers for guidance on which gold products might still qualify for exemptions.
The ruling letter that triggered this shift was reportedly issued in response to a formal request from a Swiss refinery seeking clarification on how specific types of bullion should be classified. The outcome confirmed that one-kilo and 100-ounce bars are not covered under the previously assumed exempt category. This change has introduced further confusion into an already complicated customs system, where minute differences in product classification can lead to substantial financial consequences.
Earlier in the year, traders rushed to bring gold into the U.S. ahead of a previously announced round of tariffs, leading to an unprecedented buildup of gold inventories on Comex. That move created temporary shortages in London, underscoring how swiftly the gold market can react to changes in trade policy. Back then, many believed that bullion—especially large gold bars—would remain exempt from tariffs. The latest ruling shows that such assumptions can change overnight, exposing participants to unanticipated costs.
Gold has been on a dramatic rise this year, climbing over 25% since late 2024. Analysts point to multiple drivers behind the rally: inflation fears, mounting concerns over global debt, geopolitical instability, and declining confidence in the U.S. dollar’s role as a global reserve currency. The introduction of new tariffs could add even more fuel to the rally, especially if import costs are passed on to consumers and institutional buyers.
The implications of this decision also extend beyond U.S. and Swiss borders. For example, India, one of the world’s largest consumers of gold, relies heavily on imports that include Swiss-refined kilo bars. Jewelers in India are already bracing for tighter supply and higher prices. With festive and wedding seasons approaching, a shortfall in gold supplies could push retailers to turn to alternative investment options like sovereign gold bonds and gold ETFs. Some traders in India have begun adjusting their pricing and inventory strategies accordingly.
The U.S. government’s policy change also complicates relationships with trading partners more broadly. Switzerland, known for its neutrality and stable financial systems, has traditionally maintained strong economic ties with the U.S. However, these recent moves—imposing tariffs on key Swiss exports like gold—have strained that relationship. Swiss officials and trade bodies are closely monitoring the situation, hoping for further clarification or potential diplomatic negotiations that might ease tensions.
Legal experts and customs brokers now face the challenge of navigating these new rules. The tariff classification system for precious metals is notoriously complex, often lacking the specificity required to make clear determinations. Even within the same product category, small differences in purity, weight, or intended use can lead to entirely different tariff treatments. This ambiguity creates opportunities for legal challenges but also increases the risk of noncompliance.
Meanwhile, market participants are recalibrating their strategies. Some are looking to shift gold refining and shipment processes away from Switzerland to avoid U.S. duties. Others are exploring new logistics channels or reevaluating contract terms with buyers and suppliers. The ruling may also influence physical gold storage decisions, with traders potentially holding more inventory in U.S. warehouses to hedge against further disruptions.
In addition to reshaping supply chains, this development may also impact how investors view gold as a safe-haven asset. As gold prices climb and geopolitical uncertainties rise, institutional demand for physical bullion could increase, putting further strain on already tight supplies. The potential for gold to become more difficult or expensive to source may, paradoxically, enhance its appeal as a store of value.
For now, U.S. customs officials have made it clear: one-kilo and 100-ounce gold bars will no longer enjoy tariff-free status. Whether this policy remains in place or evolves over time will depend on a range of factors, including trade negotiations, lobbying efforts, and possible appeals from affected industries.
Until then, global bullion markets will continue to adjust to this unexpected jolt—reshaping flows, altering pricing dynamics, and prompting strategic shifts from all corners of the gold trade.
