Scotch whisky latest target of US tariffs
The US government has threatened to slap tariffs on Scotch and Irish whisk(e)y over a dispute with the EU regarding civil aircraft subsidies.
The US has been locked in an ongoing disagreement with the EU at the World Trade Organization (WTO) due to civil aircraft subsidies.
As a result, on 8 April the US drew up an initial list of EU products that could be hit by tariffs, worth approximately US$21 billion.
Yesterday (1 July), the Office of the US Trade Representative (USTR) issued a public comment regarding a “supplemental list of products” worth an approximate trade value of US$4bn – including Irish and Scotch whisk(e)y.
Other whiskies outside of the Scotch and Irish contingents were also listed in the proposed supplementary tariffs, designed to “enforce US rights” in the WTO dispute with the EU and certain member states.
The public announcement stated: “USTR is adding to the initial list with the supplemental list in response to public comments and additional analysis.
“In the event the arbitrator issues its decision prior to completion of the public comment process on the supplemental list, the USTR may immediately impose increased duties on the products included in the initial list, and take further possible actions with respect to products on the supplemental list.”
US president Donald Trump ignited several trade wars in 2018 after introducing a 25% tariff on steel and a 10% tariff on aluminium imports, which came into effect on 1 June.
The EU retaliated with its own tariffs on €2.8bn (US$3.12bn) worth of US products, including American whiskey, in June last year.
In July, Canada imposed its own set of tariffs on more than 250 US-made products – including a 10% tariff on American whiskey.
July also saw the start of the “largest trade war” in history, after China hit back at the US adding tariffs to an extra US$34bn worth of Chinese products. Among the many goods affected was American whiskey, which was slapped with a 25% tariff.
Mexico also hit back with a 25% tariff on American whiskey, whose exports were valued at US$13.4 million in 2017.
In May, news broke that the US had come to an agreement with Canada and Mexico to repeal retaliatory tariffs on American whiskey exports to both countries.