Trump threatens 200% tariffs on European alcohol in retaliation against EU trade measures
President Donald Trump threatened on Thursday to impose a 200% tariff on European alcoholic beverages in response to the EU’s retaliation on his aluminum and steel tariffs. In a Truth Social post, Trump warned that his administration would enforce the tariff unless the EU rescinds the 50% tariff it imposed on American-made spirits on Wednesday.
“If this Tariff is not removed immediately, the U.S. will shortly place a 200% Tariff on all WINES, CHAMPAGNES, & ALCOHOLIC PRODUCTS COMING OUT OF FRANCE AND OTHER E.U. REPRESENTED COUNTRIES. This will be great for the Wine and Champagne businesses in the U.S.,” Trump stated.
The EU’s move came in retaliation to Trump’s 25% tariffs on aluminum and steel, which took effect at midnight Wednesday. The European Commission labeled the measure an “unjustified” trade action and swiftly implemented countermeasures, raising tariffs on $28 billion worth of U.S. goods, including motorcycles, bourbon, peanut butter, and jeans.
The EU plans to roll out additional trade penalties in two phases: On April 1, it will reinstate “rebalancing measures” that had been in place between 2018 and 2020 during Trump’s first term but were suspended under the Biden administration. Then, on April 13, the EU will introduce further duties targeting $19.6 billion in American exports to the trading bloc.
Stocks react and not in a good way
The impact of the tit-for-tat tariffs could weigh heavily on U.S. consumers, who depend on imports of the goods, not on manufacturing them, NBC News reports. Following the tariff announcements, U.S. markets fell. The S&P 500 was down 1.4% in late-day trading Thursday, continuing a slide of roughly 3.49% over the past five days.
The United States is the world’s largest importer of both wine and champagne, but ranks fifth in wine exports and 12th in exports of sparkling wine. For the past three years, the EU’s 25% tariff on American whiskey had been suspended as part of the ongoing steel and aluminum dispute, allowing U.S. distillers to regain ground in their largest export market.
“The EU’s announcement to reimpose these tariffs on American Whiskey at 50% on April 1 is deeply disappointing,” Chris Swonger, president and CEO of the Distilled Spirits Council of the United States, said in a statement, “and will severely undercut the successful efforts to rebuild U.S. spirits exports in EU countries. We urge the U.S. and EU governments to come to a resolution that gets our spirits industry back to zero-for-zero tariffs.”