US 25% tariff on European wines; 100% "digital" tariff on French products called off for the moment

[Nick Gangas]

Any new administration might be more willing to take a collaborative approach with the EU. Screwing liquor stores to prop up an airplane company might not be such a priority.

yes but what Tariffs do not do damage to some domestic industry ?

[D@vid Bu3ker]

Any new administration might be more willing to take a collaborative approach with the EU. Screwing liquor stores to prop up an airplane company might not be such a priority.

yes but what Tariffs do not do damage to some domestic industry ?

I am not debating that.

[Neal.Mollen]

July 26 is the deadline to comment, so if you haven't already done so, please go to this link and voice your opposition:
https://uswinetradealliance.org/endwinetariffs/

Talk about punishing grapes for something oranges did.

Not anxious to give this (or any) organization my contact info. Does anyone have a link directly to the USTR 301 comment page for this item?

[D@vid Bu3ker]

July 26 is the deadline to comment, so if you haven't already done so, please go to this link and voice your opposition:
https://uswinetradealliance.org/endwinetariffs/

Talk about punishing grapes for something oranges did.

Not anxious to give this (or any) organization my contact info. Does anyone have a link directly to the USTR 301 comment page for this item?

https://comments.ustr.gov/s/submit-new- ... -2020-0023

[D@ve D y r 0 f f]

Does anyone have a link directly to the USTR 301 comment page for this item?

https://comments.ustr.gov/s/submit-new- ... -2020-0023

[Neal.Mollen]

Does anyone have a link directly to the USTR 301 comment page for this item?

https://comments.ustr.gov/s/submit-new- ... -2020-0023

Done. Thanks.

[AndrewH]

Any new administration might be more willing to take a collaborative approach with the EU. Screwing liquor stores to prop up an airplane company might not be such a priority.

yes but what Tariffs do not do damage to some domestic industry ?

I'd be interested in how much damage tariffs on luxury handbags harm US industry. Hermes and Chanel and such own their own stores, right? So some employees might suffer if the stores lay off, but many of those stores are there to promote the brand anyway, and the customers that do buy may still be willing to pay increased prices.

Compare this with the argument made above that wine is an input to a robust distribution industry in the US, so is more like steel, where tariffs hurt all the downstream manufacturers.

[D@vid Bu3ker]

Any new administration might be more willing to take a collaborative approach with the EU. Screwing liquor stores to prop up an airplane company might not be such a priority.

yes but what Tariffs do not do damage to some domestic industry ?

I'd be interested in how much damage tariffs on luxury handbags harm US industry. Hermes and Chanel and such own their own stores, right? So some employees might suffer if the stores lay off, but many of those stores are there to promote the brand anyway, and the customers that do buy may still be willing to pay increased prices.

Compare this with the argument made above that wine is an input to a robust distribution industry in the US, so is more like steel, where tariffs hurt all the downstream manufacturers.

Rich people buy a Hermes handbag to tote their bottle of Veuve Cliquot.

[Nick Gangas]

Any new administration might be more willing to take a collaborative approach with the EU. Screwing liquor stores to prop up an airplane company might not be such a priority.

yes but what Tariffs do not do damage to some domestic industry ?

I'd be interested in how much damage tariffs on luxury handbags harm US industry. Hermes and Chanel and such own their own stores, right? So some employees might suffer if the stores lay off, but many of those stores are there to promote the brand anyway, and the customers that do buy may still be willing to pay increased prices.

Compare this with the argument made above that wine is an input to a robust distribution industry in the US, so is more like steel, where tariffs hurt all the downstream manufacturers.

But from this I would assume that a luxury handbag tariff will be less impactful.

[D@vid Bu3ker]

Whose job do you consider more important to their personal livelihood? The person selling handbags thinks it’s very impactful when they get laid off.

[Dan Kravitz]

As does the does the minimum wage cleaner who works for the janitorial service that cleaned the Hermes store before it shut down.

Dan Kravitz

[Nola Palomar]

No words.

https://www.reuters.com/article/us-wto- ... SKCN24P0GR

[D@ve D y r 0 f f]

I don’t know enough of the details about the dispute or this move to know if it’s significant, but it sure sounds like it could be. Wouldn’t it be nice if it could result in a tariff-removing deal, and soon? I can’t imagine that this will lead the US to just say “OK, we’re good, tariffs canceled,” but hopefully this is cause for optimism and a step in the right direction, leading to additional negotiations and a deal.

[m. ristev]

even if the tariffs cease to be, will the consumer see any savings? i have a feeling prices will continue to slowly but surely trend upward across the board.

[Mark Golodetz]

No words.

https://www.reuters.com/article/us-wto- ... SKCN24P0GR

Thanks, Nola. I did not see this. It should be good news, and hopefully jump start negotiations, especially as the US can claim victory. That in itself does not guarantee a sensible outcome.

But there is a also a pretty clear threat here too, and that should worry the Hell out of us. A fully fledged trade war is the last thing we need during this pandemic, but...and here I will let this sentence go unfinished for obvious reasons.

[Jeff_M.]

Lets hope they can work this out and we aren't penalized with crazy tariffs.

[Charlie Carnes]

Great news! Hope it continues in the right direction.

[Nola Palomar]

Expecting the news today.

[Jeff_M.]

Expecting the news today.

Let's hope it is good news. 2020 has been hard enough on us already

[Siun o'Connell]

Keeping fingers crossed Nola!

[Michel Abood]

Expecting the news today.

I have a bottle of Champagne on ice. As Churchill said, "In victory I deserve it. In defeat I need it."

[Nola Palomar]

Expecting the news today.

I have a bottle of Champagne on ice. As Churchill said, "In victory I deserve it. In defeat I need it."

Then I should put one in the frig right now!!

[Nola Palomar]

I don’t see anything published on the USTR site yet, but did come across this.

Seems we all have not suffered enough yet!


https://www.fxstreet.com/news/ustr-ligh ... 2008122154

[D@vid Bu3ker]

If you expected the tariffs to go away you were fooling yourself.

If the EU actually goes ahead and imposes tariffs related to Boeing then the nuclear war will be on.

One word: vote.

[D@ve D y r 0 f f]

Well, remaining at 25% isn't as good as going away, but it's better than going to 100%. But clearly if the shift in products is just to lift from some Greek and British and add more French and German products, we're not seeing any relief. In fact, even doing something like adding French and German wine over 14% ABV to the 25% tariff would be consistent with that description, and that would be a step in the wrong direction. Let's see what the actual announcement says whenever it gets released...

[D@ve D y r 0 f f]

Press release just posted on USTR site. Reading it now.

https://ustr.gov/about-us/policy-office ... -subsidies

[Tom G l a s g o w]

Press release just posted on USTR site. Reading it now.

https://ustr.gov/about-us/policy-office ... -subsidies

Seems to have stayed the same for wine 25% for non carbonated and under 14% alcohol.

[D@ve D y r 0 f f]

Without reading through it all, but doing a word search for "wine," it looks like the only reference to wine is a reiteration of the existing tariff. So it does not look like the additional French and German products being added include any of the wines that weren't already subject to the tariff (sparkling wine, wine in containers over 2 liters, wine over 14% abv). So status quo on wine, it would appear.

Searching for "whiskies" seems to indicate no change there either, so the British products removed from the list do not appear to include Scotch.

[Robert Panzer]

So bottom line, no change for wines?
That was my guess as to what was going to happen.

[Tom G l a s g o w]

Without reading through it all, but doing a word search for "wine," it looks like the only reference to wine is a reiteration of the existing tariff. So it does not look like the additional French and German products being added are things like wine in containers over 2 liters or wine over 14% abv. So status quo on wine, it would appear.

Searching for "whiskies" seems to indicate no change there either, so the British products removed from the list do not appear to include Scotch.

Probably British golf items had tariffs removed, the type of things you find in a pro shop.

[D@ve D y r 0 f f]

The changes appear limited to certain cheese and cheese substitutes, sweet biscuits, and jams.

If I'm reading this correctly.

[Dinesh Goyal]

Hey guys, one clarification. Are all EU non carbonated wines under 14% alcohol subject to tariff or are there any other exceptions?

[Dan Kravitz]

It's tired, I'm late, but IIRC the under 14% tariff does not apply to all EU wines, only those from the countries that produce Airbus planes:
UK, France, Germany, Spain.

Dan Kravitz

[Tom G l a s g o w]

Hey guys, one clarification. Are all EU non carbonated wines under 14% alcohol subject to tariff or are there any other exceptions?

Part 10 – Products of France, Germany, Spain or the United Kingdom described below are subject to additional import duties of 25 percent ad valorem:

Wine other than Tokay (not carbonated), not over 14 percent alcohol, in containers not over 2 liters

[Dinesh Goyal]

Hey guys, one clarification. Are all EU non carbonated wines under 14% alcohol subject to tariff or are there any other exceptions?

Part 10 – Products of France, Germany, Spain or the United Kingdom described below are subject to additional import duties of 25 percent ad valorem:

Wine other than Tokay (not carbonated), not over 14 percent alcohol, in containers not over 2 liters

Very helpful.

[D@vid Bu3ker]

Well at least my contact was right.

[Nola Palomar]

Mussels were added...
Bulk EVOO was not added.

[John Morris]

Here's an interesting chart and commentary that the American Association of Wine Economists tweeted out today.

It's interesting to see how much harder Germany is hit because its wines are lower in alcohol. Between the >14% and sparkling exemptions up to now, the average rate for France is much lower. Not sure why Spain is even lower -- lots of >14% wines and cava?

[D@vid Bu3ker]

High alcohol wine in Spain? Naaaahhhhh...

[D@ve D y r 0 f f]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

[Fred Davis]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

I can't recall ever seeing a U.S. wine on any store shelf in continental Europe. Maybe others on this board have had a different experience.

[Victor Hong]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

I can't recall ever seeing a U.S. wine on any store shelf in continental Europe. Maybe others on this board have had a different experience.

I once found a bunch of early-1990's Gallo Northern Estate at Fortnum and Mason, for around 30 pounds per bottle.

[D@vid Bu3ker]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

I can't recall ever seeing a U.S. wine on any store shelf in continental Europe. Maybe others on this board have had a different experience.

Plenty in Paris and Torino on my trips there.

[Nola Palomar]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

I can't recall ever seeing a U.S. wine on any store shelf in continental Europe. Maybe others on this board have had a different experience.

I’ve seen it in Madrid in the more boutique wine shops and rarely in Almeria also at boutique wine shops.

[Andrew Kotowski]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

I can't recall ever seeing a U.S. wine on any store shelf in continental Europe. Maybe others on this board have had a different experience.

Plenty of US wine in continental Europe. Experience based on living in Paris for two years and traveling to 15 countries semi-regularly. Not a ton, by any means, but you can always find it.

[Mark Golodetz]

A lot of wine comes into the UK, sold to private clients.

A hopeful sign. The US wine industry can ill afford any tariff based increases. Hopefully they will see sense, nobody wins a tariff war.

[John Morris]

In the past, the EU threatened to go after bourbon (Mitch McConnell's home turf) or Harley-Davidsons (Wisconsin, a swing state) -- products where the administration would feel political pressure. Targeting wine, which would be overwhelmingly from California, which is solidly in the Democratic column, wouldn't give Europe any leverage. I can't see why they'd do that.

Also, even if US wine is on the shelves in some boutiques, I bet the total dollar value is very small. Are American rum, brandy and vodka selling well over there? The don't seem like categories where US products have a lot of cachet.

[HenryB]

I'm not familiar how tariffs impact in bond wine - I can see an argument both ways, e.g. you pay the tariff on entry intto the country, so you'd pay a tariff on in bond wine. At the same time, the argument is meant to apply to duty as well, and that you don't pay in bond.

Anyone know for sure?

[AndrewH]

Just saw this article. If I'm reading it correctly, the WTO has now ruled on some portion of the EU complaint that Boeing is unfairly subsidized (recall that the existing tariffs on wines entering the USA are based on a US complaint that Airbus is unfairly subsidized). The ruling was in favor of the EU, and thus they are now allowed to put tariffs on US goods entering the EU. The EU had previously indicated that if they won, they would target (among other things?) wine, rum, brandy, and vodka. So now there is a bit of an increased effort (the US exporters of wine, rum, brandy, and vodka now being more motivated than before) to get both sides to agree to drop all tariffs on hooch. Whether that will succeed, of course, very much remains to be seen.

https://thehill.com/business-a-lobbying ... tariffs-on

Here's an article about the actual ruling:

https://www.bloomberg.com/news/articles ... oeing-case

As noted, it's for a lower amount than the ruling re Airbus (among other differences), so while it may create some room for mutual disarmament, the US may let it go only so far.

Also, at this point it's probably too late to apply meaningful political pressure through tariffs - the pressure points in the House and Senate may be different in January (e.g., will products from New York [Schumer] matter more than products from Kentucky).

[AndrewH]

Official now:

https://www.nytimes.com/2020/10/13/busi ... trade.html