US and EU spirits groups welcome removal of retaliatory tariffs

By Rachel Arthur contact

- Last updated on GMT

American Whiskey exports to the EU will no longer be subject to tariffs. Pic:getty/dianamiller
American Whiskey exports to the EU will no longer be subject to tariffs. Pic:getty/dianamiller

Related tags: spirits, Us, European union

The European Commission and US Government have reached an agreement on the Section 232 dispute on steel and aluminum: resulting in the lifting of all retaliatory tariffs on spirits after three years.

The result will be a ‘significant boost’ to transatlantic trade, as well as helping distillers, farmers and the wider restaurant and bar trade.

Retaliatory tariffs on spirits were introduced in 2018 as part of unrelated trade disputes on steel and aluminum, and then Airbus-Boeing subsidies disputes (the latter being suspended in July for five years and removing tariffs for some, but not all, spirits: with American Whiskeys being one sector remaining subject to tariffs). 

Between 1997 and 2018, the spirits sector had benefited from tariff-free transatlantic trade with growth in transatlantic spirits of more than 450% over 20 years. However, the industries on both sides of the Atlantic have suffered since the introduction of tariffs (American Whiskey exports to the EU, the US spirits industry’s largest export market, plunged 37% from $702m to 440m in 2018-2020).

Distilled Spirits Council President & CEO Chris Swonger said: “After three very difficult years of sagging American Whiskey exports, the EU and U.S. are back to a zero-for-zero tariff agreement on distilled spirits, which has been instrumental to our export success and job creation on both sides of the Atlantic since 1997.

“With the removal of these EU tariffs, we are energized and ready to ramp up our American Whiskey promotions in the EU to re-introduce America’s native spirits to EU consumers and resume a great American export success story.”

The alcohol industry has long argued that it has been unfairly hit by tariffs relating to disputes in industries it has no part of.

Responding to Sunday's agreement on Section 232, Ulrich Adam, Director General of spiritsEUROPE said: “This is a hugely positive development and a great relief to the many unrelated sectors targeted in this dispute, not least the spirits sector!

"We would like to commend the EU and the US for reaching this agreement, which finally allows us all to focus on building a positive transatlantic agenda, as we are slowly starting to rebound from the economic crisis. Returning to tariff-free trade for spirits across the Atlantic will bring much-needed certainty to distillers and our value chain partners in the hospitality sector – many of which continue to be negatively impacted by the aftermaths of the COVID crisis.”

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