Trade Tariffs On Bourbon To End With New US – EU Trade Agreement

| November 3, 2021

After three long years, it’s time to raise a glass to the end of European Union tariffs on Kentucky bourbon and American whiskey.

The Kentucky Distillers’ Association and its 51 member companies released a statement regarding the move to end the tariffs, and it came with just a month to spare as the 25 percent tariff was set to double on Dec. 1.

KDA President Eric Gregory, president of the Kentucky Distillers’ Association, said the tariffs have slashed exports of Kentucky bourbon by 50 percent to the E.U. and the United Kingdom, costing distillers, industry partners and farm families hundreds of millions of dollars.

Michter's whiskey

Whiskey aging at Michter’s in Kentucky (image copyright The Whiskey Wash)

Kentucky bourbon exports had enjoyed double-digit growth for a decade before the tariffs were imposed in 2018.

Gregory explained that the bourbon industry is an $8.6-billion economic and tourism engine that generates more than 20,000 jobs each year, with a $1 billion payroll, and welcomes nearly two million people a year to the Association’s Kentucky Bourbon Trail experiences.

Chris Swonger, Distilled Spirits Council president, said it was vital to get back to a zero-for-zero tariff agreement on distilled spirits, which has been instrumental to whiskey and bourbon export success and job creation on both sides of the Atlantic since 1997.

“Since the imposition of the EU tariffs, American whiskey exports to the EU, the U.S. spirits industry’s largest export market, have plunged 37 percent, from $702 million to $440 million. We have a long way to go, but are fully committed to building back American whiskeys better in the EU,” Swonger said. “Lifting this tariff burden not only boosts U.S. distillers and farmers, it also supports the recovery of EU restaurants, bars and distilleries hit hard by the pandemic.”

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Lawson Whiting, president and CEO for the Brown-Forman Corporation, said his company applauds the Biden administration for the recent announcement between the U.S. and the EU regarding steel and aluminum tariffs, where the bourbon tariffs resided.

Woodford Reserve, formerly the Old Pepper distillery (image via Brown-Forman)

“This agreement delivers on the administration’s promise to rebuild the Transatlantic alliance by removing tariffs on American whiskey and other U.S. exports, which have been in place now for more than three years,” Whiting said. “We would like to thank Commerce Secretary Gina Raimondo, Ambassador Katherine Tai, their counterparts in the EU, and lawmakers on both sides of the aisle for their efforts in helping reach this positive resolution.”

The removal of tariffs comes at a time when Kentucky distillers are in the middle of a $5.1 billion building spree to meet the growing global thirst for bourbon. There are now a record 10.3 million barrels of bourbon aging in Kentucky, the most in the Commonwealth’s 200-year distilling history.

Gregory added that the KDA thanks the leadership of the current White House, Kentucky Gov. Andy Beshear, Congressman John Yarmuth and officials in Europe for their efforts to resolve the ongoing trade dispute and to restore fairness in overseas markets for Kentucky’s signature distilled spirits industry.

“With the suspension of the E.U. tariffs, we urge leaders from both the U.S. and U.K. to resolve their own tariff dispute so our legendary distillers can return at long last to doing what they do best – crafting the finest bourbon for all the world to enjoy,” Gregory said.

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Gary Carter

Gary Carter has been at the helm of metro newspapers, magazines, and television news programs as well as a radio host and marketing manager. He is a writer/editor/photographer/designer by trade, with more than 30 years experience in the publishing and marketing field. Gary enjoys working to build something great, whether...