Trump Threatens 200% Tariff on Alcoholic Beverages from EU
President Donald Trump said the U.S. will "shortly" respond to EU retaliatory tariffs on U.S. whiskey with a 200% tariff on EU alcoholic beverages, including wine and champagne, if the EU whiskey tariff -- set to take effect April 1 -- isn't removed.
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In a social media post on March 13, he said that the EU "has just put a nasty 50% Tariff" on whiskey. "If this Tariff is not removed immediately, the U.S. will shortly place a 200% Tariff on all WINES, CHAMPAGNES, & ALCOHOLIC PRODUCTS COMING OUT OF FRANCE AND OTHER E.U. REPRESENTED COUNTRIES. This will be great for the Wine and Champagne businesses in the U.S."
He complained that the EU "was formed for the sole purpose of taking advantage of the United States."
Whiskey was among the products on which the EU imposed tariffs in 2018 in response to Trump's initial imposition of Section 232 tariffs. The tariffs were removed after the EU agreed to a tariff-rate quota in return for a Section 232 tariff exemption. The EU said those tariffs will snap back into effect April 1 after the U.S. ended the TRQ and reimposed the tariffs March 12 (see 2503120042).
While the EU's 2018 tariff on whiskey was set at 25%, that rate was scheduled to increase to 50% in 2021 but never did because of the TRQ deal. The EU's new round of retaliatory tariffs is set to be imposed at the higher 50% rate. A larger, second round of retaliatory tariffs is scheduled for April 13.
The Distilled Spirits Council issued a statement after the post that it is not happy with 200% tariffs on European spirits.
"The U.S.-EU spirits sector is the model for fair and reciprocal trade, having zero-for-zero tariffs since 1997. The U.S. spirits sector supports more than $200 billion in economic activity, 1.7 million jobs across production, distribution, hospitality and retail, and the purchase of 2.8 billion pounds of grains from American farmers," the group wrote. "We urge President Trump to secure a spirits agreement with the EU to get us back to zero-for-zero tariffs, which will create U.S. jobs and increase manufacturing and exports for the American hospitality sector."
WineAmerica does not want tariffs, the group says. "WineAmerica has long opposed tariffs, regardless of the Administration in power, because they ultimately hurt everyone from grape growers to wineries and consumers in a variety of ways." The group noted Canada's recent move to remove American wine and spirits from government-run liquor stores, and said "if previously exported US wines end up flooding our stores," that would lead to pricing pressure even for wineries that don't export.
In a press conference later in the day with Secretary-General of NATO, Mark Rutte, Trump brushed aside concerns that his tariffs might hurt small business owners, saying "they're going to be so much richer than they are right now." He went on to complain about the EU's "prohibitive" policies and "non-monetary tariffs," and called the European Union "very, very nasty."
He was asked if there was any chance he would "bend" on either the tariffs on aluminum, or the planned reciprocal tariffs.
"No. Look, we've been ripped off for years, and we're not going to be ripped off anymore. No, I'm not going to bend at all [on] aluminum or steel, or cars. We're not going to bend. We've been ripped off as a country for many, many years."