“We are worried that the US will be tempted to pick on wines and spirits," Miles Beale, the chief executive of the UK’s Wine and Spirits Trade Association, told The Telegraph. "We are asking the UK Government to get in there early and make the case for getting rid of the tariffs altogether, and not give any opportunity for a second Trump administration to reapply them.”
In March 2018, the Trump administration imposed a 25% tariff on steel and aluminum originating from the EU. In response, European officials slapped American whiskey imports with a 25% tariff of their own. By October of the next year, the US moved to impose tariffs on most wines and spirits originating from France, Germany, Spain and the UK.
The battle cost the industry millions of dollars. According to The Herald, scotch whisky producers lost £600 million in exports during the 18 months that the tariffs were in effect. American whiskey exports to Europe slumped 37% during the same period.
The scuffle was put on pause under the Biden presidency with one major caveat. The EU had initially planned to increase its whiskey levy to 50%, a threat that's been postponed twice amid negotiations with the outgoing administration. The 50% whiskey tariff is now slated to take effect on March 31 — unless officials can broker a new deal. The same goes for a retaliatory EU tariff on American rum, brandy and vodka scheduled for July 2026.
Whether or not the trade war will recommence lies entirely in the hands of the Trump administration.
Ben Aneff, president of the US Wine Trade Alliance and managing partner of Tribeca Wine Merchants, argues that economic protectionism amounts to a double-edged sword. During the 18 months of alcohol tariffs imposed under the previous Trump presidency, prices on imported wines like Burgundy surged by over 30%. This led to losses not only for distributors and retailers, but also domestic winegrowers.
"What's interesting is both wine America and Napa Valley vintners are firmly against tariffs, particularly including tariffs on imported wine for several different reasons, and one of them is us," Aneff remarked at a media roundtable last month. "They rely on distributors all over the United States to bring their wines into their market, to spend the money, to introduce them to their staff, to introduce them to restaurants and to introduce them to retailers. And when distributors have had a financial hit like tariffs, it leaves less money for them to invest in new, domestic, owned wineries."
Beyond Europe
Trump's universal tariff plan could — in theory — lead to disputes over any imported alcohol product originating from any country. Rather than mull over the broad details, it's perhaps more helpful to narrow in on the handful of markets that have been singled out by the President-elect's rhetoric. During several stops on the campaign trail, Trump suggested that he would impose tariffs of between 25 to 100 percent on Mexico if the country is unable to curb illegal immigration across the southern border. Auto parts and crude petroleum would be the heaviest hit; tequila, mezcal and Mexican beers like Modelo could also suffer losses. The Harris campaign was quick to point out the implications ahead of the election. In a series of videos circulated by KamalaHQ in October, influencers rallied around the tagline "Trump Tequila Tax" to describe the former president's plan. Mexican trade officials appear less convinced."Mexico's negotiation power is relevant," Mexico's economy minister, Marcelo Ebrard, remarked at a press conference last week per Reuters. "Any action that you take to put at risk (the U.S.-Mexico trade relationship) means thousands of companies. There's hardly an important U.S. company that doesn't have money here."Another country on the chopping block is China. Trump's promise to impose a 60% tariff on Chinese goods has single-handedly defined much of the discussion surrounding his economic vision. It should be noted, however, that beverage imports are only a small part of the equation — at least compared to the billions in Chinese machinery, plastics and food products imported annually. Trading Economics reports that the US imported around $60 million in consumable alcohol from China in 2023. The bulk of that number was made up of ethyl alcohol, spirits and liqueur, which amounted to $53.54 million, and beer made from malt, which amounted to $5.31 million. Were Trump's tariff plan to take effect against China, the most visible casualty to American consumers would likely be Tsingtao, which accounts for over 50% of China's beer exports. [callout-app-promo]