Alcohol Trade Groups Urge USTR to End Tariffs on Beverage Alcohol Products

Tariffs beginning to impact U.S. jobs & availability

WASHINGTON, D.C. — U.S. jobs have been eliminated and hiring halted due to the current U.S. tariff on certain EU distilled spirits and wines, and up to 78,600 U.S. jobs could ultimately be lost if these tariffs remain in effect or are increased, according to an analysis by the Distilled Spirits Council in a submission to the United States Trade Representative (USTR) by U.S. alcohol trade groups.

The tariffs, imposed on Oct. 18, 2019, are part of a long-standing dispute at the World Trade Organization (WTO) regarding civil aircraft subsidies and is unrelated to the beverage alcohol industry.

The joint submission, which included highlights from a survey of wine and spirits companies on the tariffs initial impact, stated that “The imposition of tariffs on EU beverage alcohol products has already led to the loss of U.S. jobs. We anticipate that these losses will grow the longer the tariffs are in effect, if the rates are increased, or if additional beverage alcohol products are subject to new tariffs.”

The coalition noted that retaliatory tariffs on U.S. distilled spirits imports by key trading partners continue to have a significant negative impact on the industry. American wine exports to China were down 48 percent through the first three quarters of 2019; American Whiskey exports to the EU declined 29 percent between January 2019 and November 2019 as compared to the same period in 2018; American spirits exports to Turkey declined 42 percent in the same period; and American spirits exports to China declined 8 percent in that time, after 45 percent growth in 2018 and 160 percent growth since 2010.

Additionally, the group explained that a continuation of tariffs on EU beverage alcohol products will escalate the dispute with the EU further, result in more retaliatory tariffs on additional U.S. beverage alcohol products and further reduce U.S. wine and spirits exports to the EU, the United States’ most important export market.

“We strongly urge the U.S. and EU to negotiate an agreement securing the removal of tariffs on EU beverage alcohol products, and the EU’s 25 percent retaliatory tariff on American Whiskey,” the coalition said. “Our EU counterparts share our strong opposition to the application of any tariffs on distilled spirits and wine and are urging their governments and the commission to secure an agreement to eliminate these tariffs as soon as possible.”

The joint comment was submitted by the Distilled Spirits Council of the United States, Wine & Spirits Wholesalers of America, National Association of Beverage Importers, Wine Institute, American Beverage Licensees, Wine and Spirits Shippers Association, American Distilled Spirits Association, American Craft Spirits Association, Kentucky Distillers’ Association, and National Restaurant Association.

Full text of the public comment