U.S. Watch Counters Angst of the Tremors Tariff
With Washington introducing a 10 percent across-the-board surcharge on all Swiss-manufactured time pieces in April 2025, and, more likely, a further 31 percent so-called reciprocal duty following the 90-days grace measure, American retailers have been rushing to recompute each SKU. The initial wave increased CHF 10,000 of a watch landed price by approximate USD 1100. The second wave will jack up the same reference by another USD 3,400, and the price of a wholesale shot will pass the USD 14,000 mark before the sale-tax dollar touches down. In previous tariff cycles, brands took a silent portion of the blow; now the amount is more significant, and the numbers are thinner, thus the boutiques have nearly zero padding. Freight forwarders cautions that the money pressures on smaller independents may interfere with launch schedules and model mixes at a time when shoppers are becoming used to earlier availability and even fancier selections. According to the U.S. international trade commission (2025), more than 90 percent of the U.S industries depend on carbon. (U.S. International Trade Commission, 2025)
Why a 41 Percent Increase Doesn t Feel Like the Last Time
The retailers promptly recall the 2018 metals tariffs, but they only added less than 5 percent to watch cases and bracelets. A combination of 41 percent, 10 percent universalized, and 31 percent Swiss-specific, specifically assaults the end-product. In practice, U.S., the largest export market as measured by value in the world, seems to be pricing itself out of the same segment that it nourishes. United States of America is listed in Swiss export data covering first quarter 2025 at CHF 372 million which is well above the imports in Hong Kong, although analysts working in Morgan watchley have for the first time forecasted a reduction between 8 percent and 12 percent year on year volume on the failure to reduce full duty up to Christmas. The hidden threat is replacement: collectors can switch to German or Japanese productions, whose supply chain remains duty-free and swallow Swiss shelf space which had been constructed over the decades.
The American Luxury Retail Four-Years Bull Run
Long before tariffs came the home market in haute horlogerie was roaring. U.S. sales of Swiss watches rose, boosted by stimulus-fat wallets, all-time stock-market indices and a timer-mesmerized social-media generation, to CHF 4.37 billion in 2021-2024, up nearly one-third since 2021. In 2024 alone, Los Angeles, Las Vegas and Miami had more standalone boutiques than in the whole previous decade. Even secondary cities like Austin or Charlotte experienced authorised dealers who changed to flagship formats, including watchmakers on site, lounges and warranty cards based on NFT.
Primary and Secondary Markets:Duo Towers in American Development
Simultaneously with the official channel, the second-hand arena was bursting. Markets such as WatchBox and Chrono24 saw a doubled growth in transactions in the U.S. quarter after quarter since the beginning of 2023, with an average ticket size of greater than USD 13,700. That liquidity brought new buyers into the ecosystem–first-hand ownership was not as risky when it could be liquidated a click of the mouse. But secondary-market pricing is pegged to MSRP; when retail increases by 41 percent, grey-market bids will follow up the increase and trim the arbitrage between the grey and retail markets which authorised flipping. Margins are drying like coffee in a stock-room, as the representative of one of the Chicago retailers explained it to me last month.
Tick Tock to July: The Prices will Rise: Nintendo Price tags will be going through the roof within four months!
The brands had already sent July price lists to the dealers that bake 41 percent in. The steel Aquanaut 5167A sold by Patek Philippe in January at USD 24,800, will indicate above USD 34,000. Even the entry level items are not left behind: a Longines Spirit has increased by USD 700 and now retails at USD 2,390 before implement, up from USD 1,690 in fall. In a joking manner, collectors within forums say that they get plane tickets as opposed to watches because the air fare is affordable as compared to the duty. The strategic dilemma facing retailers is when to raise stickers: should they jump on it right now and risk dead stocks or should they wait and watch then scramble to lower their profit. In any case, the consumer will be squeezed prior to Labor Day.
Tax Piling: State Canadians on Federal Tariffs
On top of the well-documented sales-tax latticework fractured in America, there is the tariff shock. Forty-five states plus D.C. impose sales taxes that are between 4 percent and a shocking 10-plus-percent when locals graft on their surcharges. Since sales tax is charged on top of the new import duties, the cost spiral affects it. A watch that was imported with new tariff of USD 20,000 may find itself at USD 30,000 on the shelves in Louisiana where the average combined tax is 10.12 percent. To most fans, that is psychologically, well at least, economically, beyond the borders.
The Cost Spread: Where You Buy City-By-City:
| City | State Sales Tax | Local/Other Taxes | Sales Tax Total | |
|---|---|---|---|---|
| Los Angeles | 7.25 percent | 2.50 percent | 9.75 percent | |
| New York | 4.00 % | 4.875 % | 8.875 % | |
| mi | 6.00 percent | 1.00 percent | 7.00 percent | |
| Las Vegas | 6.85 % | \ _iWh coffees store | 1.53 % | 8.38 % |
| Chicago | 6.25 % | 1.25 % | 7.50 % |
SOURCING: U.S. Tax Foundation, 2025
Across the state line even an experienced collector can save a leather straps worth. Those savings are washed away as soon as flights, hotels and time are factored in and low-cost hunters are even looking further afield and considering destinations abroad.
No Easy Stateside Refunds, Tourists, Sorry!
The United States does not provide a mechanism through which a tourist can get back the sales tax, unlike in Europe or Japan. There are private refund agents in Texas and Louisiana, however, the documentation is byzantine and not usually worth the time on large value watches that already consign you to customs scrutiny upon re-entry. A Canadian visitor that acquires a Rolex in the big apple will absorb the 8.875 percent as revenue duty, followed by the claim of the watch at Toronto Pearson where this person will be compelled to consume 13 percent HST. No wonder, numerous North American customers are recomputing their next vacation on friendlier shores as far as taxes are concerned.
When the Price Begins to Set the House on fire, China Offers a Lesson on Luxury-Tax:
The history of Beijing makes a lesson warning. China remade its voluntary claims on luxurious products including watches in 2016, raising the efficiency rates near to 60 percent. The government then added a 17 percent VAT to a 20 percent consumption tax and the out-the-door price went nearly twice that of MSRP. Local watch shops transformed into open exhibition centers where foreign visitors could go to make selfies and almost never make purchases. In 2017, Swiss exports to China crashed by 14 percent before reversing the downward trend but close to 50 percent of the Chinese luxury consumption continues to occur abroad. The anti-graft campaign launched by Xi Jinping even strengthened the trend: it is not so hard to be discreet in Paris than in Beijing.
Daigou and Emergence of Cross-Border Personal Shoppers
In come the daigou, business-savvy shoppers who have made it their mission to fly to Seoul, Milan or Sydney, and then load up on duty-free items before livestreaming the find to the customers back home. Bain, a consulting firm, sees daigou channel contributing to USD 15 billion in hard-luxury sales in 2024, or in other words, the total Swiss domestic market. New watch buyers use the streams to locate deals; old timers to obtain rare references as soon as they land in overseas stores. Custom rules have been tightened on the amount of goods allowed as a customs allowance, but that high price difference guarantees the racket remains, evolving to encrypted group purchases and block chain-documented escrow services.
Europe- perennial Attraction Culture, Brands and Refunds
Paris and Milan are still the spiritual centres of luxury and figures bear it out. The luxury-goods market in France ought to touch USD 25.6 billion by 2025 with watches and jewellery constituting a strong 25 percent portion. Besides having the first-dibs experience on the exclusive boutique items, the visitors are also entitled to VAT refund of up to 12 percent on handling charges deducted. One of my London-based readers informed me after the recent Geneva show that though the croissant cost three euro, the VAT-back cost three-thousand euro, so which was fluffier?
The practice obscures a Safety Issue and Currency Fluctuations The practice clouds a Safety Issue and Currency Fluctuations
Its negative effect is an increase in crime in the streets. Theft cases related to luxury watches were also recorded by both Paris and Barcelona, with both countries registering more than 10%, in the year 2024. Retailers responded by trading in logo bags in plain white carriers and increasing security budgets by two times. In the meantime, the euro lost 6 percent to the Swiss franc during January 2023 and May 2025, and this slighted induced value shoppers to move to EU countries instead of Switzerland itself.
| Country | Standard VAT | Max Tourist Refund |
|---|---|---|
| France 20 % | 12 % | |
| Italy | 22 % | 12 % |
| Germany | 19 % | 10.3 % |
| Spain | 21 % | 10.5 % |
| Switzerland | 8. 1 % | 5. 4 % |
EUROPEAN Commission, 2025 SOURCE:
An intelligent consumer thus waits until there are both refund season and favourable FX spreads thus making a city break a saving of four figures.
Tokyo uses weak yen to create GMT-Master magnet
Japan is at the other side of the coin when it comes to the story of currencies. The yen has plummeted between 110 and the dollar to 152 in spring 2025, its lowest levels since the 34 years span. Through that devaluation, luxurious imports have become about 30 percent lower even prior to taxation by tourists. Swiss exports reacted: in March 2025 Japan took the place of China as the second destination with CHF 160.6 million. Domestic consumption is healthy: 60 percent of Swiss watches are bought by high net-worth households; international tourist numbers, however, are now blowing cash registers off their spindles, Ginza to Umeda.
More than Price: Japan-Only Editions and Perfect Customer Service
The ecosystem makes the fans come back. Flagships regularly get in JDM (Japan-domestic-market) models, special dials, Kanji day wheels, or urushi lacquered bezels, which never make it past the archipelago. Throw in the mythic omotenashi service level: the bracelets are re-done in minutes, the warranty documents are bi-lingually impeccable, and the saleswoman is bowing until you disappear down the escalator. I bought a Seiko diver of my own in Shibuya in December last year, and it was nicely gift-wrapped with a handwritten note containing the mentioning of the lunar tide chart. Tourists will also be forced to claim the 10 percent consumption tax that they will no longer be able to forego at the cashier at the airport starting November 2026 and most of the purchasers has not significant problem as it is merely a procedural inconvenience.
Small Island, Colossal Appetite, Singapore
It is a small and very successful Singapore who constantly punches above its own weight. In March 2025, exports reached CHF 137.1 million catapulting the city-state into the world top six. Why? First, the depth of the inventories: The Hour Glass, Cortina and Sincere provide inventories so deep that shoppers within the respective regions fly in over weekends to make it a weekend watch-cations. Second, brands make debuts to the Asia-Pacific in Singapore and then Hong Kong, as Code 11.59 Starwheel by Audemars Piguet did in 2024.
GST Refunds and Localized Shoppers Maintain Sales afloat
The country-wide Gst in Singapore is at a rate of 9 percent refundable within 60 days to the tourists through an e-channel with no hassles at the Changi Airport. There is little crime-go out in the middle of the night on Orchard Road wearing a Daytona on the wrist and no one so much as blinks. Domestic customers who found home ground after COVID time replaced the temporary downturn in the number of mainland Chinese shoppers. The outcome is a strong liquid market where waiting lists are no longer as long as in Europe but the allocations are satisfactory.
Dubai: Service is Big and VAT is Small
In Dubai there is also a distinction of spectacle. Dubai Watch Week is also organized by Ahmed Seddiqi & Sons, and now it has become a biennial must-seek fair that mixes microbrands with big-complication royalty. Its VAT is only 5 percent, which is quite low but usually included in the sticker by the city, and thus visitors think that they pay nothing. Throw in same-day sizing, free express limo pickup, Arabic calligraphy warranty cards and you have a value offer that no one can resist.
A Playground for Horology With Bling in it
Safety concerns? Virtually none. In 2024, local law enforcement had recorded less than a dozen of watch-related robberies, and they were all solved in a matter of days. There is also a cultural trend to the exuberant: gem-set Royal Oaks and and their Daytona equivalents in rainbow are daily wrist candy, that is, with the buyer free to wear at dinner without having to scan every shadow. You might call that a caveat: heat–July and August average 45 C, so boutique hopping should be timed to the cooler evening of the winter.
Hong Kong: Tax-Free Customs in a Changing Turnover of Visitors
Hong Kong is also duty-free, a remnant of its entrepots history. Despite the political rough patch, the territory imported CHF 210.9 million worth of Swiss watches in March 2025, beating Germany and the U. K. Taken as a whole, the combination of local enthusiasts and Shenzhen day trippers pack showrooms on Causeway Bay to Kowloon. Secondary-market myths like WatchBox Hong Kong are in the same building as Rolex-run stores as well, keeping the prices clean and competitive. Hotel room cost has become the greatest challenge in the present day: the majority of hotels have occupancy rates of 87 percent, weekend rates will soon risk RMB 3,000 a night per room- take that into account in your savings equation.
A Few Things that Global Buyers Need to Remember before Their Next Flight
- • Your purchase should be timed with currency fluctuations, as well as tax-refund schedules- FX can overturn or multiply just-purchased VAT relief.
- • Study the crime rates in your area; securing a new watch will no longer be so exciting when you have to change it because you are afraid to wear it on the street.
- • Verifying refund limits: France has a limit of cash (epayments) of EUR3,000, above which the amount is transferred to credit cards.
- • Factor resale value: markets with deep liquidity on the secondary market (Singapore, Hong Kong) make exiting easier.
- Last, compute opportunity cost. Actual availability of stock on home ground can often be the best form of discount especially in cases where the model is TINA.
| Market | Export Value CHF million | Y/Y Change |
|---|---|---|
| United States | 372.0 | +6.2 % |
| China Mainland | 238.4 | -3.5 % |
| Hong Kong, 210.9, +2.1 % | ||
| Japan 160.6 + 4.8 % | ||
| Singapore | 137.1 | +3.9 % |
SOURCE
Complicate or not, steel sport Rolex or not, the 2025 terrain requires research. But to the adventurous traveller who prefers to blend tourism with spreadsheets, the payoff, as ever, is an enlightening competitive advantage, a whole new boutique experience or just the well-told anecdote about the watch.
Author Bio:
Jane Liu, a luxury-goods analyst based in Geneva, is a specialist, in how to set prices across the international border and in the psychology of consumers. In excess of fourteen years she has written in major watch journals and given retailers advice on tariff strategy.
