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USTR Holds Off On Threatened Champagne Tariffs In Tech Tax Dispute

July 14, 2020

The United States Trade Representative (USTR) has refrained from placing Champagne and other French sparkling wines on a list of goods to be targeted with tariffs in retaliation for France’s digital services tax, which affects American tech giants. This dispute is separate from the U.S.-E.U. battle over aircraft subsidies, which is currently the subject of further review by the USTR and could still lead to additional tariffs on E.U. wines and spirits.

The WSWA applauded the USTR’s restraint in the digital services case, with president and CEO Michelle Korsmo noting that “additional tariffs will have catastrophic and compounding effects for years to come—a knockout blow for many.” The WSWA cited a report from economists at John Dunham and Associates that shows that the 25% tariff on select European wines and spirits levied last October in the aircraft dispute could cost the beverage alcohol industry up to 36,000 jobs and drain nearly $5.3 billion from the U.S. economy in 2020.—Shane English

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