TRUMP THREATENS 200% TARIFF HIKE ON ALCOHOL FROM THE EU

The long-standing trade dispute between the US and the EU has flared up once again, with former President Donald Trump threatening a 200% tariff on wines, Champagnes, and other alcoholic beverages from Europe. This move is in direct retaliation to the EU’s decision to impose a 50% tariff on American whiskey, set to take effect from 1 April.

A Renewed Trade Conflict

The EU’s latest tariff decision follows Trump’s reinstatement of tariffs on steel and aluminium imports, reigniting tensions between the two economic powerhouses. In a post on Truth Social, Trump accused the EU of being “one of the most hostile and abusive taxing and tariffing authorities in the world,” stating that the bloc was “formed for the sole purpose of taking advantage of the United States.”

“If this tariff is not removed immediately, the US will shortly place a 200% tariff on all wines, Champagnes, and alcoholic products coming out of France and other EU-represented countries. This will be great for the wine and Champagne businesses in the US,” Trump declared.

The dispute over spirits tariffs has been ongoing since 2018, when the US first imposed duties on European steel and aluminium. In response, the EU levied tariffs on American whiskey, initially set at 25% before a planned increase to 50% in 2021. However, the increase was suspended under President Joe Biden’s administration, with further extensions granted until 31 March 2025. Now, the EU is preparing to implement the increase as scheduled, prompting Trump’s aggressive countermeasure.

Industry Outcry

The spirits industry on both sides of the Atlantic has condemned the escalating tariffs, warning of severe economic consequences. Pauline Bastidon of SpiritsEurope stressed the need for immediate de-escalation, saying: “This cycle of tit-for-tat retaliation must end now. We urge both sides to stop using our sector as a bargaining chip in conflicts that have nothing to do with us.”

She also highlighted the strong economic ties between the US and EU spirits industries, urging policymakers to protect the sector from becoming collateral damage in wider trade disputes.

The proposed US tariffs could deal another significant blow to European spirit exports, which are already under strain. French brandy and Cognac are currently facing an anti-dumping investigation from China, further complicating the situation. The resulting uncertainty has contributed to a 6.5% decline in the value of French spirits exports over the past year.

Calls for Resolution

Chris Swonger, president of the Distilled Spirits Council of the US (Discus), reinforced the importance of maintaining free trade in the spirits sector, reminding stakeholders that the US and EU have upheld a “zero-for-zero” tariff agreement on spirits since 1997.

“The US 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,” Swonger noted. “We urge President Trump to secure a spirits agreement with the EU to get us back to zero-for-zero tariffs, which will create US jobs and increase manufacturing and exports for the American hospitality sector. We want toasts, not tariffs.”

The Road Ahead

As the deadline for the EU’s whiskey tariff approaches, all eyes will be on the next moves from both sides. The potential for a full-scale trade war on spirits could have far-reaching consequences for producers, exporters, and consumers alike. With spirits exports deeply interwoven in the economies of both regions, industry leaders hope for a resolution that avoids further damage and preserves the long-standing tradition of transatlantic trade in premium spirits.

Whether diplomacy prevails or the tariff battle escalates further, the coming weeks will be crucial for the global drinks industry. The hope remains that common ground can be found—before consumers, distilleries, and businesses on both sides of the Atlantic bear the brunt of the fallout.