US and Scottish associations toast end of retaliatory whisky tariffs
An escalating trade row over aircraft subsidies and aluminum between the EU/UK and US over several years had seen tariffs applied to various alcohol drinks - with drinks producers highlighting that they have been a victim of unrelated disputes. Bilateral trade for the whiskey industry between 2018 and 2021 declined 35%, according to the two spirits organizations.
The 25% tariffs on whiskey between the UK and US ended yesterday.
“Now that the crippling tariffs have ended, we stand ready to help reset and strengthen the crucial trans-Atlantic trade relationship,” say the organizations in a joint statement. “This enduring partnership is critical to accelerating the recovery from the damaging impact of retaliatory tariffs, the Covid pandemic, and the increasing pressures on global supply chains.”
'The benefits of free trade are clear'
American Whiskey and Scotch Whisky are interconnected through bi-lateral trade, investment flows, and shared production practices, note the organizations (for example, whisky is the UK’s biggest F&D export to the US; meanwhile, US spirits giant Brown-Forman owns three of Scotland’s top distilleries GlenDronach, Benriach and Glenglassaugh).
Trade agreements made between the US and EU in the 1990s (which have been carried over to the UK) eliminated tariffs on most spirits – including Scotch whisky, Bourbon and Tennessee Whisky.
Between 1997-2017, when there were no tariffs on distilled spirits between the US and UK, bilateral trade in whiskies increased 212% (from $453m to $1.4bn). The retaliatory tariffs imposed on Single Malt Scotch Whisky and the American Whiskeys resulted in a 35% decrease in bilateral trade in whisk(e)y between 2018-2021 (from $1.51bn to $982m).
“The benefits of free trade are clear, and we champion it. We look forward to focusing on bringing our whiskies to consumers around the world and competing in the marketplace on a level playing field,” say the organizations.
“Securing the return to zero-for-zero tariffs would not have been possible without the dedication and strong leadership of UK Secretary of State for International Trade, Rt. Hon Anne-Marie Trevelyan MP and her predecessor Rt. Hon Liz Truss MP, U.S. Secretary of Commerce Gina Raimondo, and Ambassador Katherine Tai. We thank them and their teams for their determination to end tariffs on our sectors.
“We strongly support efforts by our governments to further enhance U.S.-UK trade through sectoral agreements and the relaunch of negotiations for a bilateral U.S.-UK Free Trade Agreement. We look forward to playing our part in growing trade between our two great countries and strengthening the special relationship which exists between the US and UK and our world class whiskies.”