On October 18th, the United States imposed a 25 percent tariff on wines and other products from France, Germany, Spain and Britain. Inexplicably, this measure did not apply to wines over 14% ABV or to sparkling wines. The tariffs are being introduced in an attempt to recoup losses sustained by American-based plane manufacturer Boeing.

The announcement came after the World Trade Organization granted the United States permission to tax European exports up to $7.5 billion annually. A list provided by the Office of the United States Trade Representative shows that a variety of European foods and drinks will be hit with a 25 percent tariff.

The list doesn’t make pleasant reading for fans of cheese, wine, and spirits. Among the items in the eight-page document are wines from France, Germany, Spain, and Britain, as long as they do not contain more than 14-percent ABV and are not bottled in containers larger than two liters.

Irish Whiskey and Scotch are also among the items with the 25-percent tariff, as are liqueurs and cordials (think Amari) from Germany, Ireland, Italy, Spain, and the U.K.

The new tax does not apply to all EU wines; Italian and Portuguese wines have escaped the increase. Also, because of the 14% ABV threshold many dessert wines and wines produced in warmer climates, specifically red wines, tend to have a higher ABV, and will be excluded. For cooler northern European regions the new tariff is problematic, because by the nature of their climate, many wines are under 14% ABV.

Going forward consumers should expect to see the price of some of their favorite wines and spirits increase. In the short term most prices will remain steady as we have made larger purchases of existing products already on American soil. However, once we sell through and are in need of restocking you will notice the change. Stock up now while you can still enjoy the better prices.

Cheers!

Bryant

Wine Buyer