Trump’s trade wars will continue to disrupt the spirits business for the foreseeable future. On Wednesday (8.12), the Office of the US Trade Representative (USTR) announced that they will slightly modify tariffs on the EU, but the existing tariffs on many European spirits will remain in place.
In short, importers and consumers stateside will still have to contend with the existing 25 percent tariffs on Single Malt Scotch Whisky, Single Malt Irish Whiskey from Northern Ireland, and liqueurs and cordials from Germany, Ireland, Italy, Spain and the UK
“The EU and member states have not taken the actions necessary to come into compliance with WTO decisions,” Trade Ambassador Robert Lighthizer stated. “The United States, however, is committed to obtaining a long-term resolution to this dispute. Accordingly, the United States will begin a new process with the EU in an effort to reach an agreement that will remedy the conduct that harmed the U.S. aviation industry and workers and will ensure a level playing field for U.S. companies.”
Across the industry, trade groups and distillers bemoaned the US tariffs as well as the retaliatory duties imposed by the EU on American distillates. Prior to the decision, 25 Senators united in a rare bipartisan display to speak out against the measures.
In a statement, the Distilled Spirits Council US (DiSCUS), diplomatic as always, first thanked the USTR for not increasing the tariffs. Then, the organization pleaded with the administration to rethink their course on the existing tariffs.
“The EU’s tariff on American Whiskey, now in place for over two years, is causing severe damage to U.S. exports and negatively impacting jobs in the U.S.,” DiSCUS declared.
“Continuing tariffs on EU beverage alcohol products will only cause additional harm to hospitality businesses in cities and towns across the country that are already suffering, resulting in additional lost U.S. jobs during these uncertain economic times.”
DiSCUS also expressed concern that the EU may escalate the situation by imposing new tax on U.S. rum, vodka and brandy. The statement also noted that the EU is scheduled to increase its retaliatory tariff on American Whiskey from 25 to 50 percent in Spring 2021.
The distillers’ confederacy suggested their own solution, “A return to the 1994 zero-for-zero tariff agreement on both sides of the Atlantic will be instrumental to the spirits industry’s future success and job creation in the U.S., EU and UK.”