UK government criticised after Trump administration opts to keep tariff on Scotch whisky

The Scotch Whisky Association has criticised the UK government for its failure to engage in talks with the US Government over exports of Scotland's national drink - after the Donald Trump administration opted to retain a 25 per cent tariff on the product.

The US tariff on whisky will remain.

Karen Betts, chief executive of the Scotch Whisky Association, said government action on the issue had been “too little, too late”, despite International Trade Secretary Liz Truss’ visit to the US last week, where she held talks with US Trade Representative Robert Lighthizer.

She said: “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. 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.”

She warned that negotiations needed to be accelerated to bring an end to tariffs before the November election in the US.

She said: “It has taken the UK government a full six months after the UK left the EU 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.”

She added: “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.”

Ian Murray, Shadow Scottish Secretary, said: “This is another blow for the whisky industry and threatens jobs in Scotland. These punitive tariffs already costing hundreds of millions of pounds.

“While the news about blends is welcome, maintaining the tariff on single malts risks forcing brands out of the market and jeopardising jobs in one of Scotland’s most important markets. Scotland is facing an economic and unemployment crisis and we need action from both governments to protect people’s jobs. The UK Government must accelerate negotiations to have these tariffs removed.”

International Trade Secretary Liz Truss said: “In Washington DC last week I met my opposite number Bob Lighthizer, the US Trade Representative, to warn against new tariffs being imposed on great British products like gin and blended whisky. I am pleased that the US has not applied these additional tariffs, and welcome the decision to lift tariffs on shortbread.

“However, the announcement does not address tariffs that already exist on goods like single malt Scotch whisky. These tariffs damage industry and livelihoods on both sides of the Atlantic and are in nobody’s interests. I am therefore stepping up talks with the US to remove them as soon as possible.”

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