Trump Threatens 200% Tariffs on European Alcohol, Escalating Trade War

WASHINGTON – President Donald Trump has vowed to impose a 200% tariff on wine, cognac, and other alcoholic imports from Europe, escalating trade tensions that have already rattled global markets. The move, announced Thursday, comes in response to the European Union’s planned tariffs on American whiskey, which are set to take effect next month.

Retaliatory Tariffs Escalate Trade Feud

Trump’s tariff threat follows the EU’s decision to impose a 50% duty on American whiskey, a response to Washington’s recent 25% tariffs on steel and aluminum imports. The president, expressing frustration over what he claims are unfair trade practices, lashed out on his Truth Social platform, writing:

"The Entire World is RIPPING US OFF!!!"

The European Commission has not yet issued an official response to Trump’s remarks. However, trade analysts warn that the tariff standoff could significantly impact the transatlantic alcohol market, which is worth billions annually.

According to industry data:

• The United States accounts for 31% of EU wine and spirits exports, making it a crucial market for European producers.
• The EU made up nearly 40% of U.S. whiskey exports in 2023, according to the Distilled Spirits Council of the United States.

Market Reaction and Business Concerns

Financial markets reacted negatively to Trump’s tariff announcement, with U.S. stock indexes slipping as investors grew wary of further trade disruptions. Shares of European alcohol producers also fell sharply, while U.S. beverage companies saw a temporary boost.

Despite Trump's assertion that the tariffs would benefit domestic producers, industry leaders on both sides of the Atlantic urged de-escalation. SpiritsEurope, a trade association representing European alcohol makers, called for an immediate end to the retaliatory trade war, stating:

"This cycle of tit-for-tat retaliation must end now!"

Meanwhile, some Canadian retailers have already started removing American bourbon from their shelves, signaling potential consumer backlash as trade tensions continue.

Economic and Political Ramifications

Trump has long defended his aggressive trade policies as necessary to revitalize American manufacturing and reduce trade deficits. Treasury Secretary Scott Bessent reinforced this stance, dismissing concerns over Wall Street volatility and warning that the EU has more to lose in a prolonged trade conflict due to its reliance on exports to the U.S.

However, economists caution that the ongoing trade war could push the U.S. economy closer to recession. A recent Reuters/Ipsos poll found that 70% of Americans believe Trump’s tariffs will lead to higher consumer prices, fueling concerns over inflationary pressure.

As tensions mount, business leaders, policymakers, and international trade officials continue to assess the fallout from Trump's latest tariff threats, with many urging diplomatic negotiations to prevent further economic disruption.