Editor’s Note
This article clarifies the conditional nature of recent U.S. tariff exemptions for certain diamonds, gemstones, and pearls, highlighting the key regulatory details importers must understand.
Last Friday, the White House said that some diamonds, gemstones, and natural pearls may be imported into the United States tariff-free. While that’s good news for the industry, the key words there are *some* and *may*.
An executive order, issued Sept. 5, said that items listed on the newly created Annex III can “potentially” be imported tariff-free. The list includes rough and polished diamonds, natural pearls, and rough and polished colored stones.
Nope—unless you’re importing gold bars. The new executive order removes the duties only for products coming from trading partners that have concluded deals with the United States.
The White House statement said that deals are in the works with the European Union, the United Kingdom, Japan, Vietnam, the Philippines, and South Korea. Big exporters like India, as well as major diamond producers like Botswana, don’t appear to be currently in the mix.
Annex III is subtitled “Potential Tariff Adjustments for Aligned Partners,” and the important word there is *potential*. The order stipulates that the president will make the final determination about which products receive which duties at his discretion.
I don’t know. There isn’t much U.S. pearl farming, and I am told that labor costs and environmental restrictions make it very difficult to scale.
It doesn’t. It only covers unset (i.e., loose) diamonds and gemstones. If you produce a piece of diamond jewelry in a country besides America, it will still be subject to a tariff based on its full value, because it was “substantially transformed” overseas.
No. That will happen only if the U.S. Supreme Court, which recently agreed to look at these new tariffs, strikes them down.
Gold bars have long been ineligible for tariffs. However, this summer a customs official ruled a certain kind of gold bar could receive duties. That’s now been rectified. And since gold bars are on a different annex than the other items we’re talking about, the exemption is effective immediately and includes countries without a trade deal.
These can be found on pages 83 and 84:
7101.10.30 Natural pearls, graded and temporarily strung for convenience of transport
7101.10.60 Natural pearls, not strung, mounted, or set
7102.10.00 Diamonds, unsorted, whether or not worked
7102.31.00 Nonindustrial diamonds, unworked or simply sawn, cleaved, or bruted
7102.39.00 Nonindustrial diamonds, worked, but not mounted or set
7103.10.20 Precious stones (other than diamonds) and semiprecious stones, unworked
7103.10.40 Precious stones (other than diamonds) and semiprecious stones, simply sawn or roughly shaped
7103.91.00 Rubies, sapphires, and emeralds, worked, whether or not graded, but not strung, mounted, or set