I’m just reading this and don’t totally understand all the details, but the initial reporting would indicate that new wine tariffs are off the table for now.
*Note: this is specific to the dispute with France and digital tariffs and separate from the Airbus issue.
Pretty sure the proposed tariffs in response to the digital tax were only a small portion (French sparkling wine, cheeses, handbags) of the overall proposed tariffs, which were largely connected to the EU Airbus subsidies. I highly, highly doubt the entire EU tariff package is off the table.
I’m reading limited press reports, so I could absolutely be wrong on all of this. I think that this stalls any additional tariffs, for now, beyond the 25% that was already imposed as part of the Airbus settlement?
I'm not sure where that notion is coming from. The Bloomberg article linked is about a deal between the US and France regarding the digital tax. The increased tariffs on EU wine (besides French sparkling wine) were an escalation of the tariffs related to the Airbus subsidies. If you have anything that indicates that an agreement between Trump and Macron over the digital tax means that the Airbus tariffs are being called off, I'd love to see it.
Thank you for clarifying that this is specific to the response to the digital tariffs and separate from the potential of additional tariffs regarding the airbus issue.This is personal opinion, and could be totally wrong, but I feel like a dramatic tariff increase was more likely in response to the digital tariffs than a massive 100% tariff in the Airbus dispute?
It's certainly possible that this is a first step to avoiding 100% tariffs, and I certainly hope so. Given that the intention of the tariffs related to EU wines was to recoup damages done to American business due to those subsidies, a slight tariff would presumably be far more effective at recouping those losses than a massive tariff that crushes the entire industry.
Each dispute had its own product list, although there was some crossover. The only wine or spirit category in the US/France Digital Services Tax dispute was French sparkling wine. After today’s announcement, which as mentioned only applies to the items on the DST list, French sparkling wine will be spared the DST tariffs until at least the end of 2020.
However, French sparkling wine remains at risk in the current round of Airbus tariffs along with all other EU sparkling wine, still wine, and scores of other categories.
“Annex I” categories such as still wines from Spain that were already subject to the 25% tariff as of October could go up any amount up to 100%, remain the same, or even be removed.
“Annex II” categories like still wines from Italy can get anywhere from 0-100%.
Annexes can be found here:
The wording of the USTR’s Airbus reassessment announcement was really strong. I’d expect tariffs on more product categories but there’s no way to know which ones or how much.
The USTR has to make its decision on Airbus by 120 days after implementing the last round of tariffs. That would be February 17 but that’s a holiday so the 14th. It could also be sooner.
Thank you for this detail!