UK & USA: Whisky jobs at risk as US maintains 25 per cent tariff on single malt imports

A UK whisky industry leader has warned that some brands are being forced out of the market and jobs are at risk following the decision by the US to maintain its 25 per cent tariff on imports of single malt, the John O’Groat Journal reported on August 13.

Karen Betts, chief executive of the Scotch Whisky Association (SWA), claimed that the tariff was causing "huge damage" and compounding the problems caused by the coronavirus pandemic.

The trade body says the whisky industry is being hit hard in its most valuable export market. The 25 per cent tariff was impose on single malt in October 2019 – part of a raft of measures in retaliation for the EU’s subsidising of Airbus – and since then exports of all Scotch whisky to the US have fallen by 30 per cent. This is said to amount to over £200 million in lost exports.

“It’s deeply disappointing to see that the 25 per cent tariff on single malt Scotch whisky exports to the US has been retained by the US government," Ms Betts said. "The tariff is inflicting huge damage on the Scotch whisky sector, with exports to the US down 30 per cent since the tariff came into effect and the industry grappling with losses now totalling around £300 million.

"These losses relate only to tariffs – the impact of Covid-19 has been serious and has compounded what is now a very serious situation for Scotch whisky, with some brands forced out of the market and jobs in the industry and our supply chain now at risk.

“The UK government must accelerate negotiations to bring an end to tariffs between the UK and US before preparations for November’s presidential election bring talks to a halt. It has taken the UK government a full six months after the UK left the European Union to start to tackle tariffs directly with the US government, which seems to us inexplicably slow.

"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.

"Negotiations on a free trade agreement with the US will not solve tariffs and will not be credible while they remain in place. While we welcomed the international trade secretary Liz Truss’s visit to the US last week to talk directly to US trade representative Robert Lighthizer, it was clearly too little, too late.

“In the meantime, the Prime Minister and Chancellor must step in to ensure that the damage to our industry is, as far as possible, mitigated. Scotch whisky is a crucial part of Scotland’s economy, employing over 11,000 people and many more than that through our supply chain, in some of the UK’s most productive jobs.

"The support promised to date – £500,000 of export promotion – is woefully inadequate compared to the support offered by the French and US governments to their national industries that have been targeted by tariffs. At the very least, the government must commit to a duty cut in the autumn budget.”

Last month the SWA urged members of the public to write to their MPs highlighting the damage the tariff was causing to Scotland's whisky industry.

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