‘Serious Threat’: Devastating 50% Whiskey Tariff Looms Over American Distillers

The American Whiskey industry is facing an existential crisis in light of a pending 50% whiskey tariff. (AP Photo/Erik Schelzig, File)

On Saturday, the Distilled Spirits Council of the United States released a statement in response to the failure to reach an agreement between U.S. President Joe Biden and the European Commission President Ursula von der Leyen involving the EU’s American whiskey tariff moratorium. The tariffs are projected to return starting Jan. 1 — this time at a staggering 50%.

Needless to say, American whiskey distillers are worried about what the future holds.

DISCUS President and CEO Chris Swonger described the tariffs as a “serious threat” to American distilling.

“Since the EU suspended its 25% retaliatory tariff on American Whiskeys in January 2022, American Whiskey exports to the EU have bounced back and surpassed pre-tariff levels,” the statement read. “The U.S. distilled spirits industry has worked hard to regain its footing in the EU market and a return of the tariffs would bring this positive momentum to a screeching halt.”

In its statement, DISCUS implored the Biden Administration to find a way to remove these tariffs permanently, citing that the uncertainty in regards to how long the tariffs will remain stymies the industry’s growth in international markets.

The original tariffs were imposed in June 2018 by the EU as a retaliatory measure due to America’s imposed tariffs on steel and aluminum under President Donald Trump.

American whiskey exports to the E.U. plummeted by 20% following the tariffs, from $552 million to $440 million.

The tariffs were suspended in October 2022, and the bourbon world let out a sigh of relief. The agreement would last for two years starting on January 1.

Through the suspension, American exports into the E.U. — its most significant market — increased to $566 million in 2022. As of July 2023, American Whiskey exports in the E.U. are up 91%.

Now, however, we approach the end of that two-year time frame, and if the tariffs return, they will, —without a doubt – bring much of the momentum the whiskey world has had overseas to a standstill.

“We urge the Biden Administration to continue to prioritize the permanent removal of these debilitating tariffs. Until the threat of tariffs returning is fully removed, the uncertainty will continue to restrict our growth in our most important international market,” Swonger’s statement read.

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