Steep 25% U.S. Tariffs Imposed on Distilled Spirits and Wine from Eastern European Take Effect
Normally fiercely competitive alcohol associations have gathered together to share their opposition to the imposition of tariffs on distilled spirits and wines imported from certain Eastern European nations into the United States.
The associations united and put out a joint statement that states, “There are no winners in a trade war. Our 15 international beverage alcohol associations sent a letter to the U.S. administration and the EU Commission calling for an immediate end to tariffs on distilled spirits and wines and welcoming their statements of their shared intent to reach negotiated solutions to the disputes. Our industries are collateral damage in trade disputes that have nothing to do with the beverage alcohol sector. This new round of tariffs will further damage a transatlantic industry that has already been negatively impacted by the EU’s retaliatory tariff on American Whiskey.”
American Whiskey Exports to the EU Down 21%
American Whiskey exports to the EU have faced a 25% tariff since June 2018 and, beginning today, certain EU spirits and wines imported into the U.S. now face a 25% tariff. Since the EU’s imposition of tariffs, American Whiskey exports to the EU have decreased nearly 21%. These tariffs are greatly harming the industry’s competitiveness, long-standing partnerships, workers and our farm suppliers. The negative impacts will be compounded by these new tariffs on EU products entering the U.S. Tariffs are taxes on U.S. consumers who create demand for these products in the U.S. marketplace.
The associations went on to say, “The U.S. and EU wines and spirits sectors are interconnected, with companies owning a range of European and American distinctive spirits and wines in their brand portfolios. As a result, these new U.S. tariffs on EU spirits and wines could result in the loss of 8,000 good- paying jobs across the U.S. beverage alcohol sector, from importers, distributors, wholesalers, to the hospitality sector.”
“This open access to each other’s markets has significantly benefited EU and U.S. distillers, vintners, farmers, and the hospitality industry on both sides of the Atlantic, resulting in increased jobs, community investment and consumer choice.”
Many U.S. wine and spirits exporters fear they may face the likelihood that the EU may respond by imposing more tariffs on U.S. wines and other U.S. spirits products.
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Holiday Season is Normally the Biggest of the Year
The next quarter is the busiest time of the year for spirits and wine producers on both sides of the Atlantic as consumers gear up for holiday gift-giving and entertaining. The associations say, “In order to protect the jobs and communities we support, we urgently call on the U.S. and the EU to reach an agreement to de-escalate the current trade disputes by immediately and simultaneously removing the EU’s retaliatory tariff on U.S. whiskey and the U.S. tariffs on EU spirits and wines.”
What Spirits are Impacted?
The United States is assessing a 25% tariff on imports of Single Malt Scotch Whisky; Single Malt Irish Whiskey from Northern Ireland; liqueurs and cordials from Germany, Ireland, Italy, Spain, and United Kingdom; and certain wines from France, Germany, Spain and United Kingdom.
Since June 22, 2018, all American Whiskeys exported to the EU have faced a 25% import tariff.
Participating Beverage Alcohol Trade Associations
• American Beverage Licensees
• American Craft Spirits Association
• American Distilled Spirits Association
• Bureau National Interprofessionnel du Cognac (BNIC)
• Distilled Spirits Council of the United States (DISCUS)
• Drinks Ireland|Irish Whiskey
• Drinks Ireland|Spirits
• Federación Española de Bebidas Espirituosas
• Kentucky Distillers’ Association
• National Association of Beverage Importers
• Scotch Whisky Association
• The Wine and Spirit Trade Association
• Wine and Spirits Shippers Association
• Wines & Spirits Wholesalers of America