Trump ramps up EU trade war with tariff threat on champagne, wine

Donald Trump has threatened to impose a 200 per cent tariff on alcohol imported from the European Union as France responds: ‘We will not yield.’

US President Donald Trump has threatened to impose 200 per cent tariffs on wine, champagne and other alcoholic products from France and other European Union countries Picture: Olivier Douliery / AFP

President Trump on Thursday announced another salvo in a fast-escalating trade war with the European Union, saying he would impose a 200 per cent tariff on US imports of wine, champagnes and other alcoholic beverages from the 27-nation bloc.

The tariff threat, Trump said, came in response to the EU’s decision to impose a 50 per cent levy on American whiskey—itself a response to 25 per cent steel and aluminum tariffs that Trump imposed this week.

The EU, Trump said in a post on his Truth Social platform, put a “nasty 50% Tariff on Whisky,” adding that if that duty isn’t removed, “the US will shortly place a 200% Tariff on all WINES, CHAMPAGNES, & ALCOHOLIC PRODUCTS COMING OUT OF FRANCE AND OTHER E.U. REPRESENTED COUNTRIES.”

France’s Prime Minister Francois Bayrou responded by saying EU countries “will not yield” to Mr Trump’s “threats”.

“It is important for us Europeans to show who we are and that we will not yield to these kinds of threats,” Mr Bayrou said in an address at a trade forum.

Donald Trump has threatened to impose 200 percent tariffs on wine, champagne and other alcoholic products from European Union countries, in retaliation against the bloc's planned levies on US-produced whiskey. Picture: AFP

The tit-for-tat over alcoholic beverages, which pushed down shares in European drinks companies, could target more than $10bn worth of European exports to the US depending on how broadly Trump imposes tariffs. In 2024, the US imported roughly $5.4bn of wine from the EU, which includes about $1.7bn in sparkling wines, according to Census Bureau data. It also imported more than $1bn of beer and more than $3.5bn of spirits such as vodka, gin and whiskey.

“Donald Trump is escalating the trade war he chose to unleash,” French Trade Minister Laurent Saint-Martin wrote in a post on X. “France remains determined to retaliate together with the European Commission and our partners.”

An EU spokesman said the bloc had no immediate comment on Trump’s threat to put 200 per cent tariffs on EU Champagne and other alcohol.

EU Trade Commissioner Maroš Šefčovič reached out to Trump administration officials immediately after Brussels announced its counter-tariffs on Wednesday, and arrangements are being made for calls between the two sides, the EU spokesman said.

“We are prepared for whatever might come,” spokesman Olof Gill said Thursday, before Trump’s announcement. “We deeply regret the introduction of tariffs on steel and aluminum imports yesterday, and we would feel the very same about any future measures.”

The new US tariff threat on EU alcohol was reminiscent of Trump’s first term, when he threatened 100 per cent tariffs on French wine and cheese over its plan to tax American tech companies. (The sides reached an agreement before those duties went into effect.) EU wines and spirits had also faced tariffs as a part of a long-running dispute between Boeing and European airplane maker Airbus, but the US and EU agreed to a five-year truce on those duties in 2021.

The EU has said that it is prepared to strike a deal with the US to avoid tariffs.

The bloc on Wednesday announced plans to impose levies of up to 50 per cent on American whiskey, motorcycles, motorboats and a range of other products starting in April. The EU said its tariffs could cover as much as $28bn in US goods, an amount that it said would match the value of EU exports affected by US metals tariffs.

The US is one of LVMH’s biggest markets, particularly for its Hennessy cognac. Picture: The Wall Street Journal

The Distilled Spirits Council of the United States, a trade association, said Thursday that it wants Trump to secure a deal with the EU that would result in zero tariffs on spirits imports from both economies.

“We want toasts, not tariffs,” Chief Executive Chris Swonger said.

France, the eurozone’s second-biggest economy, is the world’s largest wine exporter, followed by Italy and Spain. France’s most-valuable company, luxury giant LVMH, is a major producer of Champagne and cognac. The US is one of LVMH’s biggest markets, particularly for its Hennessy cognac.

Shares in LVMH, Pernod Ricard and other European drinks makers fell sharply after Trump published his post.

“Unfortunately, this type of uncertainty and roller coaster is just reality for the time being, and we’re now a part of it,” Ben Aneff, president of US Wine Trade Alliance, wrote in a social-media post.