White House considers fresh wave of tariffs on European products – including British beer

Thu 25 Jun 2020
Posted by: William Barns-Graham
Trade News

british beer

The US is threatening a fresh wave of tariffs on popular European products – including British beer – as trade tensions with the EU continue to escalate.

The White House has long voiced disapproval of EU subsidies for aircraft manufacturer Airbus. In retaliation it last year raised duties by 25% on several European imports including pork, single-malt Scottish whisky, biscuits and cheese.

The Trump administration announced on Tuesday that it is considering further tariffs on European goods ranging from Spanish olives to German lorries, report the Times.

‘Very damaging’

The reported new tariffs could be worth $3.1bn to European countries, though a ruling from the WTO last year against EU aircraft subsidies has given the US the right to impose additional levies of as much as 100 per cent on $7.5bn of European goods.

The EU has criticised the move calling it “very damaging”, saying it will create “uncertainty for companies” and inflict “unnecessary economic damage on both sides of the Atlantic”.

A European commission spokesperson said in the FT that “by potentially targeting new products, the US is increasing this damaging impact due to the cost of new disruptions to supply chains for the products potentially subject to new duties.” 

Figures from the Food and Drink Federation in May showed that UK food and drink exports fell 6.7% in Q4 2019 following the first batch of retaliatory tariffs. The US is the UK’s second largest export market for the industry.

Little progress

Talks to settle the dispute over aircraft subsidies have made little progress, in part due to disruption caused by the Covid-19 pandemic.

Relations between the EU and US also took a further knock last week when the US walked away from negotiations for a global digital tax framework.

European governments are looking to introduce digital taxes on major tech companies such as Apple, Facebook and Amazon, but the White House has argued the new tax will disproportionately affect US companies.

The EU and UK claim that US tech giants make substantial profits in Europe without contributing to public finances.