Wholesalers pleased French wine excluded from tariff list in digital tax dispute

Wholesalers pleased French wine excluded from tariff list in digital tax dispute
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The Wine & Spirits Wholesalers of America (WSWA) is cheering the Trump administration's decision to leave French wine off a list of products set to be subject to tariffs in response to France's new digital services tax.

The Office of the United States Trade Representative (USTR) on Friday announced tariffs, set to take effect next year, on $1.3 billion of French products, including makeup, soap and handbags.

A list USTR released in December of French products that could be subject to proposed tariffs had included sparkling wine and cheese, but industry groups raised concerns, and those products were excluded from Friday's list.

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“We are pleased that the USTR is responding to our efforts and has made the decision to keep French sparkling wine and champagne off of this list of tariffed goods," WSWA President and CEO Michelle Korsmo said in a statement Monday.

USTR decided to impose tariffs on French goods after determining that the nation's digital services tax is discriminatory and burdens U.S. commerce. The agency has launched investigations into whether similar taxes that have been adopted or proposed in a number of other countries are also discriminatory.

Korsmo said her group is working to ensure that European wine and spirits don't face tariffs as a result of those investigations.

WSWA also is working to fight tariffs on wine and spirits products from the European Union that went into effect in October as part of a years-long trade dispute over subsidies for Boeing and Airbus planes. USTR is currently considering whether to modify those tariffs and whether to subject additional products to tariffs.

“WSWA has been urging the USTR since June of 2019 to remove EU wine and spirits from the table of a trade dispute that originated outside of the alcohol industry — long before the pandemic," Korsmo said. "But now, at a time when the hospitality industry is fighting for its life, and additional tariffs will have catastrophic and compounding effects for years to come — a knockout blow for many.”