Liz Truss claims to fight ‘unacceptable and unfair’ Scotch whisky tariffs

UK trade secretary Liz Truss has pledged to confine the US’ punitive tariffs on Scotch whisky to the “bin of history”.

The US government said last week it would maintain 15% tariffs on Airbus aircraft and 25% tariffs on other European goods such as malt whisky and Scotch liqueurs such as Drambuie, as part of a long-running trade dispute, but did repeal some proposed tariffs.

“The Government won an important victory last week when the US announced it would not levy new tariffs on the likes of British gin, beer and sparkling wine,” Truss said in an opinion piece in the Telegraph.

“That was a welcome step, but it did not address existing tariffs on single malt Scotch and a host of other products.”

The 15-year long dispute relates to EU subsides given to aviation company Airbus over US-based rival Boeing.

In October 2019, the US has imposed tariffs on US$7.5 billion worth of EU goods – including wine, spirits and liqueurs – as result of this dispute. The country first imposed 25% tariffs on drinks including Scotch whisky and wine (not over 14% ABV) made in France, Germany, Spain and the UK. The EU has stated that it may impose retaliatory tariffs on US rum, vodka, brandy and wine.

In a separate dispute in June 2018, the EU imposed a 25% tariff on all US whiskey imports. It is scheduled to increase these tariffs to 50% in spring 2021.

Truss said she would meet with her counterpart, US Trade Representative Robert Lighthizer, in “the coming weeks” in a bid to protect Scotch whisky businesses from further tariffs.

Truss’ op-ed, published on 16 August, comes days after an unusually critical statement from the Scotch Whisky Association’s chief executive, Karen Bets, who accused the government being “inexplicably slow” to act on the tariff issue.

She said that exports to the US have fallen 30% since the tariffs were imposed in October, amounting to a loss of around £300 million. Some firms have pulled out of the US altogether.

“It has taken the UK government a full six months after the UK left the EU to start to tackle tariffs directly with the US government, which seems to us inexplicably slow,” she said. “The UK government must now focus its energy on developing a clear strategy for settling the UK share of the Airbus/Boeing and steel and aluminium disputes with the US, rather than looking to the EU to do this for us.”

Last week, Truss paid a visit to the US to talk directly to Lighthizer about a proposed trade agreement once the UK has fully separated from the European Union. She claims that the agreement could “boost trade by £15 billion and wipe out almost half a billion pounds of tariffs.”

However, negotiations on a free trade agreement with the US “will not solve tariffs and will not be credible while they remain in place”, Bets said.

“While we welcomed International Trade Secretary Liz Truss’ visit to the US last week, to talk directly to US Trade Representative Robert Lighthizer, it was clearly too little, too late.”