The Daily Telegraph - Business

Brexit toasted as US suspends tariffs on UK exports such as whisky, stilton and clothes

Four-month halt to levies secured with new president after Britain’s decision to cut import taxes in January

- By Alan Tovey and Ben Riley-Smith

AMERICA has agreed to suspend punitive tariffs on a host of UK goods including Scotch whisky, cashmere clothes and clotted cream in a victory for postBrexit Britain, after a truce was agreed over illegal state aid for aircraft makers.

The deal means that levies of 25pc will be lifted on £550m of exports to the US. The duties were imposed two years ago as part of a long-running row about subsidies and tax breaks offered to Airbus and Boeing.

One of the biggest beneficiar­ies is the Scottish whisky industry, which supports 50,000 jobs and counts the US as its largest market.

Other industries helped include producers of cheeses, such as stilton, gin distillers and clothing companies that sell upmarket products to Americans.

Liz Truss, the Trade Secretary, touted the deal as a new sign of transatlan­tic co-operation now the country has left the European Union.

She said: “This is Global Britain in action: securing new opportunit­ies as a newly nimble nation.

“This breakthrou­gh shows that we can do more under our values-driven approach to stand up for British industry than was possible as part of the EU. We are sending a powerful signal that the best way forward for us all lies in free and fair trade.”

Products sold to America were hit by World Trade Organisati­on-sanctioned tariffs when former president Donald Trump sought to protect domestic manufactur­ers such as Boeing.

The tariffs were imposed after the WTO ruled both Airbus and Boeing had been given state support that broke internatio­nal rules – the culminatio­n of a 16-year feud between the firms fought by proxy through their government­s.

To offset the harm, both the EU and US were allowed to put charges totalling $12bn (£9bn) on a wide range of imports and not those in the aerospace industry alone. The EU announced it was imposing the tariffs in November 2019 after it was given the green light by the WTO. But in a surprise move in January, the UK dropped import levies on goods from the US – something ministers said was only possible because Britain had left the EU.

The decision was part of a campaign by the UK to secure a trade deal with the US and improve relations with the new administra­tion of president Joe Biden.

Ms Truss said the four-month suspension of tariffs on goods sold to the US, which starts on March 8, was a result of “our clear show of good faith”. She added that Britain had “brought the

US back to the negotiatin­g table and allowed us to make proposals for a resolution”.

Boris Johnson, the Prime Minister, said: “It shows what the UK can do as an independen­t trading nation, striking deals that back our businesses and support free and fair trade. I now look forward to strengthen­ing the UK-US relationsh­ip.”

Airbus has repeatedly said it wants to find a negotiated settlement to the row with Boeing, a move that would protect the aerospace duopoly from rivals gaining power in China.

There are concerns that if the world’s two biggest aircraft manufactur­ers cannot agree a deal where they abide by WTO rules, this would pave the way for Beijing to pump state aid into its aerospace industry – making it harder for the establishe­d players to compete.

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