An executive order issued on 5 September includes a new annex listing natural goods that may qualify for duty-free importation, including unset diamonds, natural pearls and coloured gemstones. The exemptions would apply only to imports from countries that have signed formal trade agreements with the United States.
The order does not apply to finished jewellery, cultured pearls or laboratory-grown diamonds.
Annex III: Scope and Conditions
The newly introduced annex, titled Potential Tariff Adjustments for Aligned Partners, outlines a list of products that are either not found in the United States or are only available in limited quantities. These include unset and unmounted diamonds, precious and semi-precious stones, and natural pearls. Products in this category may be considered for exemption from tariffs if imported from countries with a finalised trade agreement with the US.
Countries reportedly negotiating or finalising trade agreements with the US include Japan, the United Kingdom, the European Union, South Korea, Vietnam and the Philippines. India and major African diamond-producing countries are not currently included.
The decision to remove tariffs on items in the annex will be made at the President’s discretion and is not automatic, even where trade agreements are in place.
Impact on Finished Jewellery and Component Imports
Only loose, unmounted materials are included in the proposed exemptions. Finished jewellery remains subject to tariffs, regardless of whether the gemstones or diamonds used are covered under the annex.
Sara Yood, president and CEO of the Jewelers Vigilance Committee, said: “Importers of diamond or gemstone jewellery will have to pay tariffs on the whole item. This could mean it is more advantageous to import components rather than finished goods, which would theoretically mean a benefit towards domestic manufacturing, one of the administration’s stated goals. You would not be able to subtract the diamond cost from the tariff calculation.”
This may make importing components rather than finished goods more viable, aligning with the administration’s stated support for domestic manufacturing.
Cultured pearls and laboratory-grown diamonds have separate tariff classifications and are not included in the annex.
Raw Metal Tariff Adjustment
The executive order also removes tariffs on raw gold, platinum, palladium and rhodium, including semi-manufactured forms. This applies immediately and does not require the exporting country to have a trade agreement with the US.
This reverses a customs ruling from earlier in the year that had applied duties to certain gold bars.
No Immediate Implementation
There is currently no formal guidance from US Customs and Border Protection on when or how the tariff exemptions will take effect. Until trade agreements are finalised and further announcements are made, duties on the listed items remain in force.
The US Supreme Court is also reviewing the broader legality of the tariffs. Any refund of previously paid duties would depend on the outcome of that case, which remains undecided.
Implications for the Jewellery Trade
The potential removal of tariffs on unset stones and precious metals may support certain areas of the supply chain, particularly domestic manufacturing and component assembly. However, given the uncertainty surrounding trade negotiations and the discretionary nature of the exemptions, the overall impact on importers remains limited for now.
Importers should continue to monitor official updates and review supply chain and tariff classifications in light of ongoing developments.
