EU Sets Its Sights on American Bourbon in $84 Billion Retaliatory Tariff Plan

(Photo: Jeff Chiu/AP Photos)

On Tuesday, Bloomberg reported that the European Union has prepared a $84 billion retaliatory tariff plan set to take effect if trade tensions continue to escalate with the United States. Among the products singled out in the E.U.’s list are whiskey and wine, both of which have found themselves at the center of symbolic tug-of-war over iconic American exports.

Over the weekend, President Trump promised to slap E.U. and Mexico with an across-the-board 30% tariff beginning on Aug. 1. The President published a set of letters on Truth Social that were reportedly sent to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum Pardo. The letters took issue with illegal immigration, the ongoing fentanyl crisis and trade imbalances. Trump invited the bloc to further negotiations, adding that his tariff hikes may be dropped if the EU decides to “build and manufacture product within the United States.”

“Please understand that the 30% number is far less than what is needed to eliminate the Trade Deficit disparity we have with the EU,” Trump said in his letter to von der Leyen.

In a written statement, von der Leyen stressed that the EU will continue to work toward an agreement with American officials ahead of the deadline. She added, “at the same time, we will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required.”

A 206-page list seen by Bloomberg News reveals what those “proportionate countermeasures” may entail. According to the outlet, a plan drafted by the European Commission targets $75 billion in American industrial goods such as aircraft, machinery and cars. Over $2 billion in fruits and vegetables would also be affected, alongside nearly $1.4 billion in alcohol including wine and whiskey.

Liquor, particularly bourbon, has emerged as a hot-button issue in ongoing trade negotiations between American and European officials.

The topic made headlines earlier this year when the EU moved forward with a 50% tariff on American whiskey exports, intended as a rebuttal to Trump’s proposed 25% tariffs on steel and aluminum. President Trump hit back in a Truth Social post, promising to place a 200% tariff on all alcohol products originating from EU-represented countries unless the whiskey duties were repealed. Within weeks, the EU drafted a new tariff plan that omitted whiskey, wine and dairy.

The fate of American whiskey flip-flopped once again following Trump’s “Liberation Day” announcement on April 2. Bourbon was added back to the E.U.’s list of suggested tariffs, and it reportedly hasn’t budged from the negotiating table in the ensuing months.

Chris Swonger, president of the Distilled Spirits Council of the United States, says that a whiskey trade war could devastate the American liquor industry. The situation last unfolded in 2018, when a 25% tariff on whiskey reportedly cost American distillers over $100 million in the span of three years.

“Reimposing these debilitating tariffs at a time when the spirits industry continues to face a slowdown in U.S. marketplace will further curtail growth and negatively impact distillers and farmers in states across the country,” Swonger said in March. “We urge the U.S. and EU governments to come to a resolution that gets our spirits industry back to zero-for-zero tariffs.”