Up until very recently, much of the US wine importer industry was bracing for a major hit, with original estimates for wine and food tariffs floating at potentially 100%. Doing this would have overnight doubled the price of wine, causing what were probably untenable price shocks for the industry.

The original tariffs were put in place last October, hitting most of the industry with 25% increases. And not just wine- many other European food industries, such as cheese, also have had some tariffs imposed.

The most recent round was based around a dispute over a digital tax that France had hoped to impose on tech companies that wanted to do business in France. American tech giants like Facebook and Google cried foul, saying this was a direct attack on a sector dominated by American companies, and that it would be too costly for them to absorb. After weeks of negotiations, the two nations reached a détente, and the 100% tariffs were postponed at least until August.

While the separate issue of the Airbus lawsuit did involve hitting finished aircraft with additional tariffs as detailed last week, the food and beverage industry was granted a stay on additional costs. Producers from elsewhere in Europe can breathe easier, as most of the other major wine producing regions, such as Italy, will not be touched by the current wave of tariffs.

As these are imposed under the same “section 301” justification that has driven the increased tariffs from China, these will be eligible for duty drawback.

If you have any questions about how these tariffs affect your company and your ability to seek drawback refunds, please contact www.jmrodgers.com

Sincerely, James Rodgers