Marketing

No increase in US tariffs on wine & spirits

While not increasing them the US will be keeping current 25% tariffs remain in place following an announcement from the US Trade Representative body at the weekend.

 

“The US Trade Representative has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on US products in connection with the large civil aircraft dispute or with the EU’s WTO challenge to the alleged subsidisation of US large civil aircraft.” – USTR.

“The US Trade Representative has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on US products in connection with the large civil aircraft dispute or with the EU’s WTO challenge to the alleged subsidisation of US large civil aircraft.” – USTR.

The tariffs apply to a number of drinks products including still wine below 14% ABV from France, Germany, Spain and the UK, Single Malt Scotch and Single Malt whiskey from NI as well as liqueurs from Germany, Italy, Spain, the UK and Ireland that are imported into the US from the EU.

Fears had been expressed at the end of last year that the US was going to increase these tariffs by up to 100% and widen the list of wines and spirits subject to them in response to the US’s now more than 10 years old grievance against the Netherlands-based Airbus company.

However the USTR noted, “The US Trade Representative has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on US products in connection with the large civil aircraft dispute or with the EU’s WTO challenge to the alleged subsidisation of US large civil aircraft.”

The US alcohol industry could lose up to 36,000 jobs and more than $1.6 billion in wages this year as a result of the trade tariff war according to a study commissioned by the Wine & Spirits Wholesalers of America, costing the US economy more than $5.3 billion.

The tariffs imposed by the European Union are causing a significant slump in American Whiskey exports, admitted the Distilled Spirits Council of the United States President and Chief Executive Chris Swonger.

New data released from the US International Trade Commission show that the EU’s 25% retaliatory tariff on American Whiskey caused exports to the EU, the US’s largest spirits export market, to tumble 27% last year compared to 2018. Global exports of American Whiskey have declined 16% and global spirits exports are down 14.3% over the same timeframe.

“We are gravely concerned that if these disputes are not resolved soon, these US tariffs on EU spirits imports will cause a similar drag on the US economy, jeopardising American companies and jobs,” stated DISCUS.

This follows DISCUS stating in its annual economic briefing that, “The devastating impact of the retaliatory tariffs on distilled spirits products is accelerating, threatening to upend the decade of growth in the US spirits sector”.

On the other side of the pond the Scotch Whisky Association has stated that the tariffs could be losing Scotch producers at least £100 million a year in exports to the US.

The SWA’s Chief Executive Karen Betts recently welcomed the UK Prime Minister’s commitment that the UK government will remove EU tariffs on US whiskey as soon as possible now that the UK has left the EU.

The tariffs will again be reviewed in about six months’ time.

 

 

 

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