UK-US trade agreement: End to the whiskey “tariff nightmare”?
24 Mar 2022 --- While the global market grapples with inflation, one silver lining has been the UK’s nascent trade agreement with the US, which rolls back Trump-era tariffs on British steel and aluminum exports in exchange for lifting similar taxes on US-distilled spirits, various agriculture products and consumer goods.
The agreement will be enforced on June 1, lifting duties on more than US$500 million worth of US whiskey.
“The agreement will have little impact on the consumer – except for the fact they are able to buy more US products, such as whiskey,” Sophie De Salis, communications executive of the British Retail Consortium, tells FoodIngredientsFirst.
Chris Swonger, chief executive of the Distilled Spirits Council, comments that US-based distillers celebrated “the end of this long tariff nightmare.” Statistics published by the organization reveal that US whiskey exports to Britain declined by 42% since the tariffs’ roll-out in 2018.
“With the removal of the UK’s debilitating retaliatory tariffs on American whiskey exports, US distillers are ready to fire up the stills,” he adds.
The agreement will be enforced on June 1, lifting duties on more than US$500 million worth of US whiskey.US-based spirits and wine producer Brown-Forman echoed this sentiment: “Brown-Forman appreciates the Administration’s unwavering commitment to rebuilding the Transatlantic alliance. The removal of tariffs on whiskey and other US exports creates more opportunities for the continued international growth of our American-made products.”
Bourbon on the rebound
The Kentucky Distillers’ Association (KDA) – comprising 50 member companies – commended the move: “After a four-year dry spell, it’s time to raise a toast.”
According to the KDA, the tariffs imposed in 2018 caused a retrograde in what was “tremendous growth” in Kentucky Bourbon exports to the UK, costing distillers, industry partners and farm families hundreds of millions of dollars.
As one of Kentucky’s most historic industries, bourbon fuels the state’s US$9 billion annual economic and tourism engine while sustaining 22,500 jobs on a payroll of US$1.23 billion.
The KDA also reports that local distillers in this state are currently in the midst of a ten-year, US$5.2 billion building spree to meet the global thirst for the US’ only native spirit. At present, there are now more than 10.3 million barrels of Bourbon aging in Kentucky, a record amount.
“With the suspension of these tariffs, we look forward to rekindling bourbon enthusiasm in the UK,” remarks KDA president Eric Gregory.
By Benjamin Ferrer
