CaratTen and twelve-and-a-half: the tariff wall comes back
A new Section 301 regime puts 10% duties on jewelry from India, Canada and Britain and 12.5% on China, Thailand, Turkey and the UAE, effective July 24. Diamonds polished in the EU keep their exemption.
§1A new legal footing, an old kind of wall.
The Trump administration reset its tariff machinery on July 24, imposing fresh duties on imported jewelry, diamonds, gemstones and precious metals from roughly sixty countries. The legal footing is new: with earlier levies struck down when the Supreme Court invalidated the administration's use of emergency economic powers, the White House reached instead for Section 301 of the 1974 Trade Act, framing the action as a response to countries said to under-enforce prohibitions on forced labor. The practical effect is a two-band wall across the trade's supply map.
The higher band, 12.5%, falls on China, Hong Kong, Israel, Thailand, Turkey and the United Arab Emirates, the cutting floors, manufacturing centers and trading hubs that move a large share of the world's finished goods. The 10% band covers a longer list that includes India, Canada, Mexico, Indonesia, Malaysia, Pakistan, Sri Lanka and the United Kingdom. For a business that sources across a dozen borders before a stone reaches a display case, almost every common route now carries a number it did not carry a week ago.
§2The exemptions are the whole game.
The exemptions are where the detail lives. Diamonds and gemstones polished in the European Union keep the exemption they already held, an advantage that quietly rewards Antwerp and Idar-Oberstein against Surat and Bangkok. The EU and Taiwan face a net-of-most-favored-nation approach that tops combined rates up to a 10% floor; Japan, South Korea and Switzerland are handled the same way under a 12.5% cap. Goods already in transit on July 24 are spared, a narrow window that importers spent the week trying to widen.
Diamonds and gemstones polished in the European Union keep the exemption they already held, an advantage that quietly rewards Antwerp and Idar-Oberstein against Surat and Bangkok.
§3The trade reads it as a beginning.
The trade's compliance voices read the move as a beginning rather than an end. "The story is not over; people need to continue to pay attention," said Sara Yood of the Jewelers Vigilance Committee, noting that additional Section 301 inquiries into manufacturing capacity could add further duties later. The new bands also stack onto country-specific measures already in force, including the 50% rate on Canadian goods and the separate action against Brazil, so a single shipment can now carry more than one layer.
A 10% floor is survivable; the uncertainty around it is not. The EU carve-out is the tell, quietly steering polished volume toward Antwerp and away from Surat, and the promise of further inquiries means no importer can price a spring order with confidence.
Expect the near-term response to be the oldest one in the book: pull inventory forward, sit on the goods in transit, and pass what cannot be absorbed to the counter.
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India cuts nine in ten stones. The duty lands there.