President Donald Trump on Thursday threatened to impose a massive 200% tariff on European alcoholic beverages in response to the European Union’s retaliation against his steel and aluminum tariffs.
The European import tax, unveiled in response to the U.S. administration’s steel and aluminum tariffs, is expected to go into effect on April 1, just ahead of separate reciprocal tariffs that Trump plans to place on the EU.
In a post on Truth Social, Trump stated that his administration would impose a 200% tariff on alcoholic beverages from the EU unless it rescinds the 50% tariff the European government imposed on Wednesday on U.S. spirits.
“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,” Trump said. “This will be great for the Wine and Champagne businesses in the U.S.”
America’s response to Europe’s retaliation in the span of 36 hours demonstrates how trade wars can quickly spiral out of control. After Trump’s 25% tariffs on aluminum and steel went into effect at midnight Wednesday morning, the EU immediately retaliated against what it called an “unjustified” trade action from the Trump administration.
EU’s countermeasures
The EU’s countermeasures included tariffs on €26 billion ($28 billion) worth of American goods, including boats, bourbon, and motorbikes. These measures, set to go into effect in April, are “swift and proportionate,” the EU said in a statement.
America’s spirits industry said Wednesday it was bracing for pain from the retaliatory tariffs. If the trade spat continues to escalate, U.S. booze makers may need to contend with even more retaliation.
French Trade Minister Laurent Saint-Martin said on Thursday that “Trump is escalating the trade war he has chosen to start” and that his country would “fight back.”
“We will not give in to threats and will always protect our industries,” he wrote in a post on X.
Olof Gill, trade spokesperson for the EU Commission, called on the U.S. “to immediately revoke” the steel and aluminum tariffs imposed on Wednesday. “We want to negotiate, to avoid tariffs in the future,” he said. “They bring nothing but lose-lose outcomes, and we want to focus on win-win outcomes.”
What you should know
Alcoholic beverages are one of the EU’s top exports to the U.S., according to data from the bloc.
- France shipped almost 27 million bottles of Champagne to the U.S. in 2023, making America the top destination for exports of the premium beverage ahead of the United Kingdom.
- The Irish Whiskey Association also said in a statement Thursday that tariffs put “jobs, investments and businesses at risk and have the potential to be devastating” for its industry.
“There is no winner in a trade war,” the association said, noting that the U.S. is its biggest trading partner.
When Europe responded to Trump’s 2018 tariffs with a 25% tax on U.S. whiskey, exports to the EU fell by 20% through 2021, according to the Distilled Spirits Council. Trump’s separate 25% tariffs on Canada and Mexico could put 31,000 jobs at risk in the sector.
