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15-03-2025
WASHINGTON: US President Donald Trump has threatened a 200% tariff on any alcohol coming to the US from the European Union (EU) in the latest twist of an escalating trade war.
The threat is a response to the EU’s plans for a 50% tax on imports of US-produced whiskey as part of its retaliation to Trump’s tariffs on all steel and aluminium imports to the US.
The US president called for the immediate removal of the EU’s “nasty” tariff on US whiskey, calling the bloc “hostile and abusive” and “formed for the sole purpose of taking advantage of the United States”.
A European Commission spokesperson said that “calls are being prepared” between between the US and the EU to discuss the situation.
It confirmed that its trade commissioner, Maroš Šefčovič, had “reached out to his American counterparts” after Trump’s latest threat.
The stand-off marked another escalation of a trade war which has rattled financial markets and raised concerns over the impact on the economies and consumers in many countries around the world, including the US.
Europe sends more than €4.5bn ($4.89bn; £3.78bn) worth of wine each year to the US, which is its largest export market, according to the Comite Europeen des Entreprises Vins, which represents the European wine industry.
Ignacio Sánchez Recarte, secretary-general of the group, said if Trump carried through on his threats, it would destroy the market, costing thousands of jobs.
“There is no alternative to sell all this wine,” he said, pleading with the two sides to “keep wine out of this fight”.
The latest clash came after new US tariffs on steel and aluminium came into effect on Wednesday, hitting imports of the metals with a blanket duty of 25% and ending exemptions from the duties that the US had previously granted for shipments from some countries, including from the EU and Canada.
Canada and Europe – which are among America’s biggest trade partners – called the new taxes unjustified and struck back with their own tariffs on a range of US products. The EU’s measures are due to go into force 1 April.
The clash reprises a battle that played out during Trump’s first term, when he first announced tariffs on steel and aluminium.
The EU responded with its own tariffs, including a 25% tax on American whiskey.
In the aftermath, whiskey sales to the EU dropped 20%, falling from roughly $552m in 2018 to $440m in 2021, according to the Distilled Spirits Council of the US. Trump in turn
The tariffs were lifted after Trump left office, after the two sides reached an agreement that exempted a certain amount of European metals from the duties but Trump has indicated little appetite for deal-making so far, at least when it comes to steel and aluminium.
“If this Tariff is not removed immediately, the US will shortly place a 200% Tariff on all wines, champagnes & alcoholic products coming out of France and other EU represented countries,” he wrote on social media, using all capital letters for some of the message.
The targeting of wine and whiskey is symbolic, there are few consumer goods more iconic than French Bordeaux or Tennessee whiskey. From a value standpoint, drinks trade is worth less than some of the other items facing tariffs but Mary Taylor, a US-based importer of European wines, said the measures would be catastrophic for her business and industry, with an impact that would ripple out to restaurants, bars and distributors across the US. (Int’l Monitoring Desk)
