WASHINGTON — In 2018, then-President Donald Trump, citing national security concerns, placed tariffs on some imported steel and aluminum. The European Union retaliated by slapping a 25% tariff on American whiskeys, a blow to Kentucky’s bourbon makers.
What You Need To Know
- A deadline looms for the EU to reimpose a tariff on American whiskeys if the EU and U.S. don’t reach an agreement in a dispute
- Kentucky’s bourbon industry said it's caught in the middle of an unrelated trade dispute between the U.S. and the EU
- In 2018, then-President Donald Trump placed tariffs on some imported steel and aluminum and the EU retaliated by slapping a 25% tariff on American whiskeys
- The EU suspended the tariff during President Joe Biden's administration
Whiskey exports to the EU plunged 20%, according to the Distilled Spirits Council of the United States (DISCUS).
“Our industry got caught up in a tit-for-tat trade dispute between the U.S. and the EU, and not only bourbon was affected, but other sectors in the distilled spirits industry was affected as well,” said Chris Swonger, president and CEO of DISCUS.
During President Joe Biden's administration, the EU suspended the tariff.
While DISCUS said American whiskey exports rebounded, the industry is bracing for a March 2025 deadline when the EU is set to reimpose its tariffs at 50% if the EU and U.S. don’t reach an agreement in the steel and aluminum dispute.
“We want to make sure those tariffs aren't imposed by the EU, and we're going to be working very, very closely with the incoming Trump administration to make sure that doesn't happen,” Swonger said.
As he campaigned this year for another term in the White House, Trump promised to be a “tariff president.”
“The word ‘tariff,’ properly used, is a beautiful word,” Trump told a crowd in Georgia in September.
“The growth of American whiskey and the growth of Kentucky bourbon has been a phenomenal American success story, and that's what's at stake because it could slow down that growth,” Swonger said.
It’s estimated Kentucky produces 95% of the world’s bourbon, an industry that employs more than 23,000 people and generates $9 billion of economic output.
Gov. Andy Beshear, D-Ky., said Tuesday he hopes the incoming Trump administration keeps the people of the commonwealth in mind.
“I hope they take an approach that’s more scalpel than sledgehammer, and I hope they consider a state like Kentucky, which went for President Trump by 30 points, and say we’re not going to make it harder on the businesses that employ all those voters,” Beshear said.
Eric Gregory, president of the Kentucky Distillers’ Association, told lawmakers in Frankfort last week that the industry is worried about the potential impact of the tariffs.
“When the tariffs first hit, the companies tried to absorb as much of that as they possibly could … but after a few years, it’s hard for any company to keep absorbing a 25% tariff,” Gregory said. “If that goes to 50%, I don’t know many companies that can absorb a 50% tariff, so yes, we are always exploring other countries and other free-trade agreements.”
Spectrum News reached out to the White House and President-Elect Trump’s team for comment.