EU Postpones Reimposing Whiskey Tariff

By Richard Thomas

Distilleries great and small in America were granted more than a year of space to breath easy, as the European Union and the US agreed to postpone scheduled retaliatory tariffs on each others products for another 15 months.

This smoldering trade dispute dates back to the Trump Administration, which slapped tariffs on European-made steel and aluminum in 2018. The EU responded with tariffs on selected US products, such as motorcycles and power boats. Whiskey was also on the list, widely perceived at the time as a means of applying pressure to then-US Senate Majority Leader Mitch McConnell, who hails from America’s top whiskey-making state of Kentucky.

The problem with trade wars is they don’t simply go away, even when governments change and both sides agree that they should. As The Whiskey Reviewer reported at the time, the trade war did not result in lower prices for whiskey or an easing of certain scarcity issues in the US. Instead, all it accomplished was the ruination of whiskey industry export plans for large and small producers alike.

Biden won the election just in time to prevent the EU from implementing a mandated doubling of the retaliatory tariff to 50%, and talks on resolving the underlying dispute over aluminum and steel have continued ever since. The US replaced the tariffs with an import quota system in 2022, which the EU saw as an improvement, but complained still resulted in European producers paying over $250 million in unfair import duties annually. By postponing the return to retaliatory tariffs, the EU has signaled it wants negotiations to continue, and 15 months places the new deadline after the US 2024 general election.