trade wars

The Wine World Waits to See If ‘Catastrophic’ Tariffs Will Take Effect

Chambers Street Wines in New York City. Photo: Melissa Hom

Trump’s looming tariffs are terrifying the American wine world, and restaurateurs, retailers, importers, distributors, and others are rallying against it. There’s no timeline on the proposed 100 percent tax that would affect European wines and other goods yet, but if you’re plugged into the restaurant world, you’ve certainly seen social-media posts advocating against the tariffs and asking you to speak out against them. Monday, January 13, was the deadline for public comments on the proposed tariffs. Since December 12, nearly 25,000 were made to the Office of the United States Trade Representative.

To recap, there are two tariff proposals, both involving a 100 percent tax. One would only affect French goods, including Champagne, in response to France’s Digital Sales Tax on American tech companies. The other would affect wine and other goods from all European Union countries and is in response to subsidies for Airbus that the World Trade Organization has deemed unfair. But these tariffs are an escalation of a trade war that’s already started. Last year, the Trump administration imposed a 25 percent tariff on English, French, German, and Spanish still wines under 14 percent, as well as Scotch and Irish whiskey.

The New York Times wine critic Eric Asimov spoke to a number of restaurateurs and shop owners, all of whom envision scenarios that are roughly grim to apocalyptic. A co-owner of the East Village’s Il Posto Accanto, an Italian wine bar, tells the paper, “This will be the end of us,” while an importer, Jon-David Headrick, says the 25 percent tariff already imposed last year have been hard enough to deal with. Speaking to the Dallas News, James Gunter, the owner of importer and distributor Wines With Conviction, puts a number on it, saying the 25 percent tariff equals a price hike of $2 to $3 per bottle. Industry leaders are weighing in, too. Union Square Hospitality Group head Danny Meyer tells Asimov that “it’s completely ludicrous to have these trade wars somehow connect airplanes to wine.” This is a point echoed by others, who are wondering why fights over taxes on tech giants and European Union subsidies for Airbus have spilled over into the wine world.

Speaking to Chicago’s WGN-TV, Cream Wine Company founder Andy Pates says the tariffs are “going to be catastrophic.” Southern Glazer’s Wine and Spirits executive director Barkley Stuart tells the Dallas News that “the tariffs will cause more damage to the U.S. economy than to the French economy, and therefore are counterproductive.”

In an op-ed for CNN, wine writer Jon Bonne writes, “If you’re asking yourself what Big Tech and big aerospace possibly have to do with Burgundy and provolone, you aren’t alone.” He argues that this is dumb politics at work: Wine is for the snobby elites whom Trump — a man whose New York home is ludicrously lavish, decorated with gold, and in an actual tower — rails against. France will, Bonne points out, probably retaliate, which isn’t great, given that one-third of our own wine exports from California go to the E.U. Some 78,000 jobs could be at risk, he adds.

One California wine retailer is trying to offer a solution, reports Alder Yarrow for the website Jancis Robinson. Speaking at a USTR hearing on the Digital Sales Tax on January 7, Lyle Fass of Fass Selections said, “We all know these tariffs are a nuclear bomb,” adding he’s against them even while suggesting limiting the tariffs to larger brands like Veuve Clicquot and Moët & Chandon. The owner of Dom Pérignon, Krug, Moët & Chandon, Veuve Clicquot, and some other major Champagne brands is LVMH, which is controlled by the French billionaire Bernard Arnault. As Yarrow puts it, this would put the focus on an $18 billion business instead of potentially putting many small importers and distributors in danger.

The Wine World Rallies Against ‘Catastrophic’ Tariffs