Scotch whisky makers toast five-year suspension of US tariffs

Whisky makers are raising a glass after the UK and US agreed to suspend retaliatory tariffs on goods including Scottish malts for five years, in the de-escalation of a transatlantic trade dispute stretching back almost two decades.

Liz Truss, the UK international trade secretary, said a “historic deal” had been reached with Washington to ensure tariffs, which affected UK exports to the US worth £550m, remain suspended.

It comes after the Biden administration agreed a similar settlement with the EU on Tuesday, as governments on both sides of the Atlantic take greater steps to resolve tensions over subsidies for the aircraft manufacturers Airbus and Boeing.

The 17-year dispute, the longest-running in the history of the World Trade Organization, had led to damaging tit-for-tat tariffs levied on products on both sides due to disagreements over support for large civil aircraft production.

British goods that had been targeted by tariffs – border taxes paid by the buyers of goods from another country – had included cashmere, machinery and single malt Scotch whisky.

The Scotch Whisky Association said the past two years of tariffs – first imposed by Donald Trump – had been extremely damaging for the industry, with the loss of more than £600m in exports to the US caused by a 25% tariff on single malt. Karen Betts, the trade body’s chief executive, said: “This deal removes the threat of tariffs being reimposed on Scotch whisky next month and enables distillers to focus on recovering exports to our largest and most valuable export market.”

Pig farmers in Yorkshire, stilton cheesemakers in the Midlands, cashmere producers in Ayrshire, construction vehicle makers and liqueur and cordial producers had been hit by the tariffs on tens of millions of pounds of exports.

Britain had been involved in the dispute as a member of the EU, but eased tensions earlier this year by unilaterally suspending tariffs on the US. The government said this had encouraged the US to agree a four-month suspension on tariffs, until both sides negotiated a longer-term agreement.

The UK and US will now work together to put the agreement into practice and strengthen cooperation in the large civil aircraft sector, it said.

It comes after Liz Truss met the US trade representative, Katherine Tai, in London on Wednesday.

“Today’s deal draws a line under an incredibly damaging issue and means we can focus on taking our trading relationship with the US to the next level, including working more closely to challenge unfair practices by nations like China and using the power of free trade to build back better from the pandemic,” Truss said.



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