logo
US wine shops and importers say Trump's threatened 200% tariff on European wines would kill demand

US wine shops and importers say Trump's threatened 200% tariff on European wines would kill demand

Independent13-03-2025

The United States is suddenly looking less bubbly for European wines.
President Donald Trump on Thursday threatened a 200% tariff on European wine, Champagne and spirits if the European Union goes forward with a planned 50% tariff on American whiskey. Wine sellers and importers said a tariff of that size would essentially shut down the European wine business in the U.S.
'I don't think customers are prepared to pay two to three times more for their favorite wine or Champagne,' Ronnie Sanders, the CEO of Vine Street Imports in Mt. Laurel Township, New Jersey, said.
Jeff Zacharia, president of fine wine retailer Zachys in Port Chester, New York, said 80% of the wine he sells is from Europe. Importers depend on European wines for a big part of their distribution system, he said, and there's not enough U.S. wine to make up for that.
'This is just going to have a major negative impact on the whole U.S. wine industry in all aspects of it, including U.S. wineries,' he said.
Zacharia said there are so many unknowns right now he's stopped buying European wine until the picture becomes clearer.
'It's very hard to make preparations when as a business you don't have a clear path forward,' he said. 'Our preparations would be very different if it's 200% compared to 100% compared to 10%.'
Wine and spirits from the 27-nation European Union made up 17% of the total consumed in the U.S. in 2023, according to IWSR, a global data and insight provider specializing in alcohol. Of that 17%, Italy accounted for 7% -- mostly from wine – and French wine, cognac and vodka accounted for 5%.
Overall, the U.S. imports much more alcohol than it exports. The $26.6 billion worth of foreign-produced alcoholic beverages that entered the country in 2022 accounted for 14% percent of all U.S. agricultural imports, according to the U.S. Department of Agriculture. The U.S. exported $3.9 billion worth of beer, wine and distilled spirits that year.
Marten Lodewijks, president of IWSR U.S., said a 200% tariff would not be unprecedented but import duties of that size tend to be more targeted.
In 2020, China imposed tariffs as high as 218% on Australian wine, which caused exports to plunge by 90%, Lodewijks said. China lifted the tariffs last year, but by then Australia's wine industry had taken a big hit. Australia's wine trade to China was worth 1.1 billion Australian dollars ($710 million) annually before the tariffs were put in place.
Europe's tax on American whiskey, which was unveiled in response to the Trump administration's steel and aluminum tariffs, is expected to go into effect on April 1. Trump responded Thursday in a social media post.
"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 wrote. 'This will be great for the Wine and Champagne businesses in the U.S.'
Trump was incorrect about the Champagne business. Champagne is a legally protected wine that can only come from France's Champagne region. But U.S. winemakers — including Trump Winery, a Virginia winery owned by the president's son Eric Trump — do make sparkling wine.
Reaction from across the Atlantic was swift Thursday.
'We must stop a dangerous escalation that is leading to a global trade war where the first victims will be U.S. citizens who will pay more for products, and with them, farmers,'' Ettore Prandini, president of Italy's Coldiretti agriculture lobby, said.
Italian wine exports to the U.S. – led by prosecco -- have tripled in value over the last 20 years and reached 1.9 billion euros ($2.1 billion) last year. In France, the U.S. market for wines and spirits is worth 4 billion euros ($4.3 billion) annually.
Gabriel Picard, who heads the French Federation of Exporters of Wines and Spirits, said 200% tariffs would be 'a hammer blow' for France's alcohol export industry, impacting hundreds of thousands of people.
'Not a single bottle will continue to be expedited if 200% tariffs are applied to our products. All exports to the United States will come to a total, total, halt,' Picard said in an interview with The Associated Press.
French transporter Grain de Sail, which uses sail power to ship wines and other goods across the Atlantic, said Thursday that some winemakers had already cancelled planned shipments of wine to the U.S. because they were anticipating tariffs even before Trump's announcement.
'It has more or less frozen exports. There's no point even hoping to send wine to the United States under these conditions,' said Jacques Barreau, the firm's co-founder.
Some U.S. wine stores saw an opportunity Thursday. In Washington, the wine bar Cork announced a tariff sale, encouraging regulars to come stock up on their favorite wines while they're still affordable.
Others wondered aloud whether Trump would really go through with a 200% tariff.
'It changes by the hour now, right?" Mark O'Callaghan, the founder of Exit 9 Wine & Liquor Warehouse in Clifton Park, New York, said. European wines make up around 35% of sales at his store, he said.
Others seemed to want to stay out of the fray. Total Wine, which operates 279 stores in 29 U.S. states, didn't respond to a request for comment Thursday. Southern Glazer's Wine & Spirits, one of the country's largest alcohol distributors, also didn't respond to a message seeking comment.
___
Anderson reported from New York. Durbin reported from Detroit. AP Writers Colleen Barry in Rome, John Leicester in Paris and Zeke Miller in Washington contributed.

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Live Israel ‘ready to strike Iran' over its nuclear programme
Live Israel ‘ready to strike Iran' over its nuclear programme

Telegraph

time22 minutes ago

  • Telegraph

Live Israel ‘ready to strike Iran' over its nuclear programme

Israel is considering launching a military strike against Iran in the coming days without American support, Western officials say. The officials said fears of either no deal or a weak deal between Donald Trump and the Islamic Republic to curtail its nuclear programme had forced Israeli strategists to consider a unilateral attack against Tehran. It comes as the UN nuclear watchdog's board of governors found that Iran had broken its non-proliferation agreement for the first time in 20 years. The governors demanded Iran provide answers 'without delay' in a long-running investigation into uranium traces found at several locations that Tehran has failed to declare as nuclear sites. In response to the ruling, the Islamic Republic said it had no choice but to respond by establishing a new enrichment facility in a 'secure location'. A senior Iranian official told Reuters that Tehran will not abandon its right to uranium enrichment because of mounting frictions in the region, adding that a 'friendly' country had alerted Tehran over a potential military strike by Israel.

Rachel Reeves fails to rule out future tax rises as economy shrinks
Rachel Reeves fails to rule out future tax rises as economy shrinks

Glasgow Times

time29 minutes ago

  • Glasgow Times

Rachel Reeves fails to rule out future tax rises as economy shrinks

The Chancellor has repeatedly said that the cost of Wednesday's spending review is covered by the tax rises she brought in last year, saying departments must now 'live within their means'. But economists have warned that a weakening economy and additional commitments such as reversing much of the cut to winter fuel payments mean taxes are likely to go up again in the autumn. Asked on Thursday whether she could guarantee there would be no further tax rises, Ms Reeves told LBC: 'I think it would be very risky for a Chancellor to try and write future budgets in a world as uncertain as ours.' But she again repeated her promise that she would not need to increase taxes on the same scale as last year, when she put them up by £40 billion. And she rejected the suggestion that she was a 'Klarna Chancellor' who had announced a 'buy now, pay later' spending review. She said: 'The idea that yesterday I racked up a bill that I'm going to need to pay for in the future, that's just not right.' Her comments come as the Office for National Statistics reported that the economy shrank by 0.3% in April – the biggest monthly contraction since October 2023 and worse than the 0.1% fall most economists had expected. In recent days, both Ms Reeves and Number 10 have said the economy is beginning to turn a corner, allowing them to fund the U-turn on the winter fuel allowance. But Thursday's worse-than-expected economic news will make it harder for Ms Reeves to balance her spending commitments with Labour's promises on tax and borrowing. The Chancellor acknowledged that the reduction in GDP was 'disappointing', and blamed 'uncertainty' caused by Donald Trump's announcement of sweeping tariffs at the start of April for much of the fall. But opposition parties have laid the blame squarely with the Government, with Conservative shadow chancellor Sir Mel Stride accusing Ms Reeves of 'economic vandalism'. He said: 'Under Labour, we have seen taxes hiked, inflation almost double, unemployment rise, and growth fall. With more taxes coming, things will only get worse and hard-working people will pay the price.' Daisy Cooper, the Liberal Democrats' Treasury spokeswoman, said the figures should act as 'a wake-up call for the Government which has so far refused to listen to the small businesses struggling to cope with the jobs tax' and urged ministers to pursue a 'bespoke UK-EU customs union' to compensate for the impact of US tariffs. The GDP figures come a day after the Chancellor revealed her spending plans for the coming years, including a significant increase in spending on the NHS, defence and schools. The biggest winner was the NHS, which will see its budget rise by £29 billion per year in real terms, leading the Resolution Foundation's Ruth Curtice to say Britain was slowly morphing into a 'National Health State'. But that rise came at the price of real-terms cuts elsewhere, including the Home Office, the Department for Transport and the Department for the Environment, Food and Rural Affairs. On Thursday, Ms Reeves rejected claims that her decision on policing, which will see forces' 'spending power' increase by 2.3% above inflation each year, would mean cuts to frontline police numbers.

Rachel Reeves fails to rule out future tax rises as economy shrinks
Rachel Reeves fails to rule out future tax rises as economy shrinks

South Wales Guardian

time29 minutes ago

  • South Wales Guardian

Rachel Reeves fails to rule out future tax rises as economy shrinks

The Chancellor has repeatedly said that the cost of Wednesday's spending review is covered by the tax rises she brought in last year, saying departments must now 'live within their means'. But economists have warned that a weakening economy and additional commitments such as reversing much of the cut to winter fuel payments mean taxes are likely to go up again in the autumn. Asked on Thursday whether she could guarantee there would be no further tax rises, Ms Reeves told LBC: 'I think it would be very risky for a Chancellor to try and write future budgets in a world as uncertain as ours.' But she again repeated her promise that she would not need to increase taxes on the same scale as last year, when she put them up by £40 billion. And she rejected the suggestion that she was a 'Klarna Chancellor' who had announced a 'buy now, pay later' spending review. She said: 'The idea that yesterday I racked up a bill that I'm going to need to pay for in the future, that's just not right.' Her comments come as the Office for National Statistics reported that the economy shrank by 0.3% in April – the biggest monthly contraction since October 2023 and worse than the 0.1% fall most economists had expected. In recent days, both Ms Reeves and Number 10 have said the economy is beginning to turn a corner, allowing them to fund the U-turn on the winter fuel allowance. But Thursday's worse-than-expected economic news will make it harder for Ms Reeves to balance her spending commitments with Labour's promises on tax and borrowing. The Chancellor acknowledged that the reduction in GDP was 'disappointing', and blamed 'uncertainty' caused by Donald Trump's announcement of sweeping tariffs at the start of April for much of the fall. But opposition parties have laid the blame squarely with the Government, with Conservative shadow chancellor Sir Mel Stride accusing Ms Reeves of 'economic vandalism'. He said: 'Under Labour, we have seen taxes hiked, inflation almost double, unemployment rise, and growth fall. With more taxes coming, things will only get worse and hard-working people will pay the price.' Daisy Cooper, the Liberal Democrats' Treasury spokeswoman, said the figures should act as 'a wake-up call for the Government which has so far refused to listen to the small businesses struggling to cope with the jobs tax' and urged ministers to pursue a 'bespoke UK-EU customs union' to compensate for the impact of US tariffs. The GDP figures come a day after the Chancellor revealed her spending plans for the coming years, including a significant increase in spending on the NHS, defence and schools. The biggest winner was the NHS, which will see its budget rise by £29 billion per year in real terms, leading the Resolution Foundation's Ruth Curtice to say Britain was slowly morphing into a 'National Health State'. But that rise came at the price of real-terms cuts elsewhere, including the Home Office, the Department for Transport and the Department for the Environment, Food and Rural Affairs. On Thursday, Ms Reeves rejected claims that her decision on policing, which will see forces' 'spending power' increase by 2.3% above inflation each year, would mean cuts to frontline police numbers.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store