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Why it could be more expensive for Scotch whisky drinkers in the U.S. but good news for gin and beer lovers

The U.S. administration stated on Wednesday that it would maintain slapping a 15% tariff on Airbus and 25% on different European items, accusing the European Union of failing to take steps to adjust to a World Trade Organization ban on billions of euros of presidency subsidies to the European plane maker.

– The tariffs had been imposed by the U.S. Trade Representative in late 2019 on $7.5 billion value of imports, together with Airbus and a variety of European merchandise, equivalent to Italian cheese or single-malt Scotch whisky. It raised the tariff on plane from 10% to 15% in February.

– This week’s determination retains the identical quantity of taxable imports, but eliminated merchandise from Greece and the U.Okay. so as to add items coming from France and Germany. It will take impact on September 1.

– U.Okay. commerce secretary Liz Truss welcomed the U.S. determination to not tax objects equivalent to gin, beer and candy biscuits like shortbread, but complained that present tariffs, equivalent to these on Scotch whisky, “damage industry and livelihoods on both sides of the Atlantic.”

– Europeans predict {that a} symmetrical determination from the WTO later this yr will sanction subsidies prolonged to airplane maker Boeing by U.S. authorities, which might enable Brussels to hit again with related tariffs on U.S. imports.

The outlook: The EU aspect is each disenchanted that the tariffs weren’t lowered or scrapped altogether, and relieved that they weren’t elevated. And it is value remembering in this unending EU-U.S. dispute that tariffs are first and foremost paid by the customers of the importing nation — which units a de facto ceiling on how excessive they will go. Expect more showmanship, threats and mutual accusations in the run-up to the WTO ruling in the fall. Meanwhile, after all, EU commerce czar Phil Hogan and U.S. Trade Representative Robert Lighthizer proceed to barter.

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