WHISKY MAKERS WELCOME HALT OF TARIFF
U.S. agrees to suspend costly tariffs on one of Scotland’s main exports
Scotch single malt whisky makers breathed a sigh of relief Thursday after the United States agreed to suspend tariffs on one of Scotland’s main exports in the wake of the resolution of a longstanding transatlantic trade row over subsidies to aircraft companies Boeing and Airbus.
President Donald Trump imposed the 25 percent tariffs on select products of the European Union, including Scotch single malt whiskies, in October 2019 as part of the trade dispute. While the U.K. is no longer an EU member, it belonged to the bloc when the tariffs were introduced.
Earlier this week, the U.S. and the EU reached an agreement to end the aerospace dispute, paving the way for a 5-year suspension of tariffs. Parallel talks were held between the U.S. and the U.K. over the tariffs.
The tariffs on Scotch single malts were the most high-profile to affect Britain. The Scotch Whisky Association estimated that they contributed to a 30 percent fall in total whisky exports to the U.S., equivalent to around £600 million ($850 million) in the 18 months to March 2021.
“This deal removes the threat of tariffs being re-imposed on Scotch whisky next month and enables distillers to focus on recovering exports to our largest and most valuable export market,“Karen Betts, the association’s chief executive, said.
A thaw in U.S.-EU relations had been widely expected following the election of President Joe Biden. Tariffs linked to the Airbus-Boeing dispute were temporarily halted in a bid to negotiate a solution.
Following the U.S.-EU aerospace agreement, British International Trade Secretary Liz Truss and the U.S. Trade Representative Katherine Tai agreed to halt retaliatory tariffs for five years.
“Today’s deal draws a line under an incredibly damaging issue and means we can focus on taking our trading relationship with the U.S. to the next level, including working more closely to challenge unfair practices by nations like China and using the power of free trade to build back better from the pandemic,“Truss said.
Tai said the agreement, in which both sides also agreed to form a working group on the civil aviation industry, can be built upon to “ensure fair competition and address common challenges from China and other non-market economies.”