The Distilled Spirits Council of the United States (DISCUS) has submitted a report with the United States Trade Representative (USTR) that identifies key barriers to foreign trade that impede distilled spirits exports from the United States.

These barriers include retaliatory tariffs, discriminatory taxation, import policies, and certification and labeling measures in countries around the world.

Retaliatory tariffs have been imposed on U.S. distilled spirits since mid-2018 by the European Union, Turkey and China. As a result, in 2019, total U.S. spirits exports declined by 14.3 percent to $1.5 billion and American whiskey exports declined by 16 percent to $996 million, compared to 2018.

In addition, annual American whiskey exports to the EU declined 41%, from $757 million between July 2017 and June 2018 to $449 million from August 2019 to July 2020.

Prior to the identified barriers, U.S. spirits exports had expanded significantly over the past two decades, thanks in large part to the comprehensive market-opening trade agreements that the U.S. has achieved. 

DISCUS member companies export to more than 130 countries worldwide, with total U.S. spirits exports in 2019 valued at more than $1.5 billion. Additionally, U.S. spirits are now exported from small, medium and large distillers located in 45 states.

Countries identified by DISCUS that assess excessive tariffs, discriminatory excise taxes, and other non-tariff barriers on imported distilled spirits, include:

• India: maintains an excessive tariff of 150 percent ad valorem
• Vietnam: imposes a 45 percent ad valorem tariff
• EU, Brazil, Thailand, Indonesia, Peru, Costa Rica, and Ecuador: continue to apply discriminatory spirits taxes in favor of domestically produced spirits
• Thailand, Ireland, India, South Africa, India, Argentina and elsewhere:  labeling requirements and standards of identity are under consideration, which are inconsistent with standard international practices and could impose unnecessary barriers to entry for U.S. spirits exporters

“The retaliatory tariffs on American Whiskey exports to key markets, including our largest market the EU, is the number one trade barrier facing the U.S. spirits industry, which is facing enormous economic hardships due to the pandemic,” said Robert Maron, DISCUS vice president for international trade. “DISCUS strongly encourages all parties to resolve the trade disputes and eliminate the retaliatory tariffs on spirits exports as soon as possible and avoid the imposition of additional tariffs on spirits.”