President Donald Trump vowed to impose a steep 200% tariff on French Champagne, wine and other European spirits in a tit-for-tat measure after Europe announced its own levies on Tuesday.
“The European Union, one of the most hostile and abusive taxing and tariffing authorities in the World, which was formed for the sole purpose of taking advantage of the United States, has just put a nasty 50% Tariff on Whisky,” Trump said in a post on Truth Social on Wednesday.
“If this Tariff is not removed immediately, the U.S. will shortly place a 200% Tariff on all WINES, CHAMPAGNES, & ALCOHOLIC PRODUCTS COMING OUT OF FRANCE AND OTHER E.U. REPRESENTED COUNTRIES,” the American president added.
Following the announcement, shares in major drink companies, including Diageo, Remy Cointreau, Pernod Ricard, and conglomerates like LVMH, all fell.
The ongoing trade war began when Trump introduced a 25% tariff on steel and aluminum from Europe. In response, the bloc announced that it would reinstate its tariffs on U.S. steel, agriculture, and consumer goods—including whiskey—on Tuesday.
“Reimposing these debilitating tariffs at a time when the spirits industry continues to face a slowdown in U.S. marketplace will further curtail growth and negatively impact distillers and farmers in states across the country,” Chris Swonger, CEO of the Distilled Spirits Council of the United States (DISCUS), said in a statement Wednesday.
EU’s tariffs would account for 5% of U.S. imports to the bloc, which amounted to €531.6 billion ($580 billion) last year.
“We deeply regret this measure. Tariffs are taxes. They are bad for business, and worse for consumers. They are disrupting supply chains. They bring uncertainty for the economy,” European Commission President Ursula Von der Leyen said.
France immediately said it would fight back against any U.S. tariffs on champagne, wine and other alcoholic drinks with foreign trade minister Laurent Saint-Martin posting on X that “We will not give in to threats.”
France, he said, was “determined to retaliate”.