Home Enthusiast EU tariffs on American whiskey lifted, UK tariffs remain

EU tariffs on American whiskey lifted, UK tariffs remain

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On Saturday, October 30, the United States and the European Union (EU) reached an agreement to cancel the 25% tariffs that had been imposed on American products like whiskey in 2018. The agreement enters into force. effective January 1, 2022 and avoids additional tariffs on U.S. products that were scheduled to come into effect on December 1.

The 2018 tariffs on U.S. products like whiskey, peanut butter and jeans were in retaliation for the Trump administration’s taxes on EU steel and aluminum.

This weekend’s news gives relief to US producers who claim that the 2018 tariffs caused a “significant drop” in exports in 2019 and 2020. In March 2021, an agreement between the EU and the United States lifted the tariffs on American wine, as well as on certain other national spirits. , but the tariffs on whiskey had remained until now.

Currently, tariffs between UK and US are still in place.

Spirits producers have greeted the latest news with relief and cautious optimism about the effect on future sales.

“We’re thrilled with the tariff lifting,” says Scott Harris, co-founder of Virginia Craft Distillery Catoctin Creek. In 2018, he put his plans on hold to start exporting rye whiskey to Europe due to tariffs. “We have been suffering from the 25% penalty for many years now, and today we have a free and fair market again in Europe.

Catoctin is wasting no time in resuming his expansion plans and will ship 1,500 cases of whiskey to Europe this month, Harris said. “Even though sales have been almost nil over the past four years, we are now set and ready to grow again in Europe. “

“Today we have a free and fair market again in Europe. –Scott Harris, Catoctin Creek

Dr Sonat Birnecker Hart, president of Chicago-based Koval Distillery, has a similar reaction.

“We are delighted that the tariffs have been removed,” she said. “They have created a huge burden on all American spirits brands, but especially craft brands like mine.” Before tariffs, Koval’s export volume grew by about 20% per year, Hart says. “After tariffs, these exports fell by more than 50%, as did overseas confidence in US whiskey brands.”

For many producers, tariffs entailed significant opportunity costs. Even as U.S. whiskey brands focus on rebuilding their export businesses, supply chain issues, labor shortages, and other pandemic-related issues could hamper plans during the month. less than a year.

“It’s going to take a while,” says Amir Peay, owner / operator of the James E. Pepper Distillery in Kentucky. “We’re back to square one, in a sense. We are happy and optimistic about the future, but it will take time to rebuild the business we had and the relationships. Nonetheless, he is confident for “2023 and beyond”.

The damage – and hope for the future – isn’t limited to artisanal stills, of course.

“Since the imposition of the EU tariffs, exports of US whiskey to the EU, the largest export market for the US spirits industry, have fallen 37%, from $ 702 million to $ 440 million (2018-2020), ”said Chris Swonger, CEO and President of the Distilled Spirits Council of the United States (DISCUS).

While “the end of this long tariff nightmare is in sight for American distillers,” Swonger says, it is not over until the situation with Britain is resolved in the same way. “It is time for the UK to lift its tariffs on American whiskeys so we can all get back to toast, not tariffs.”

Posted on November 3, 2021


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