US tariffs on wine to be suspended after reaching a deal with EU to end aviation dispute
The US and the EU have finally come to an agreement over the long standing row over Boeing-Airbus that will see all tariffs suspended for five years, only a month before the temporary suspension was about to expire.
The US trade representative Ambassador Katherine Tai said that the deal brought to an end the “trade irriitaiton in the US_Europe relationship” which has been rumbling on for 16 years, and paved the way for a five year suspension of tariffs that were imposed on $7.5bn worth of EU goods by former President Trump in October 2018.
"We agreed to work together to challenge and counter China’s non-market practices in this sector in specific ways that reflect our standards for fair competition," said Tai during a press call.
The 25% tariffs affected still wine under 14% ABV made in Germany, France, Spain and the UK transported in containers of two litres or less. Scotch whisky, liqueurs and brandy were also hit by the taxes.
The trade dispute skyrocketed under the Trump administration, and saw tit-for-tat duties slapped on a range of companies that have nothing to do with aircraft production, from French winemakers to German bakers in Europe and US spirits producers in the United States, among many others.
Under the new Biden administration the president agreed a temporary halt to tariffs with Bruussels, abandoning the tariffs on each others’ drinks sectors for four months while striving towards achieving a longer term agreement over the aviation dispute, which was set to expire on July 11th 2021.
"Instead of “ighting with one of our closest allies, we are finally coming together against a common threat,” said Tai. However, she warned that if either side reneged on the deal then they retained the right to reimpose the tariffs. “Should EU support cross a red line and U.S. producers are not able to compete fairly and on a level playing field, the United States retains the flexibility to reactivate the tariffs that are being suspended,” said Tai.
Chris Swonger, president and CEO of Distilled Spirits Council welcomed the move, adding that the five year suspension of tariffs came at a critical time for the US hospitality sector. “Today’s announcement is an important building block to reset the bilateral relationship and we urge the administration to build on this positive monmenturm,” he said.
Meanwhile, the UK’s international trade secretary Liz Truss will meet Tai in London today (Wednesday) to hold discussions over the UK-US trade deal and on ending the aviation trade dispute.