Single malt Scotch whisky exported to the United States will now face a tariff of 25% from 18 October following a ruling by the World Trade Organisation, giving the US the go-ahead to impose tariffs on $7.5bn (£6.1bn) of goods it imports.
Scotch exports to the US last year were worth $1.3bn (£1bn), with single malts accounting for a large share of that.
The duty is part of a raft of measures being imposed by the US in retaliation against EU subsidies given to aircraft maker Airbus. Other goods being targeted include cashmere sweaters, dairy products, pork, olives, biscuits, books, and some machinery.
The move has been roundly condemned by industry bodies.
Karen Betts, Chief Executive of the SWA, said, “The tariff will undoubtedly damage the Scotch Whisky sector. The US is our largest and most valuable single market, and over £1 billion of Scotch Whisky was exported there last year. The tariff will put our competitiveness and Scotch Whisky’s market share at risk.
“We are also concerned that it will disproportionately impact smaller producers. We expect to see a negative impact on investment and job creation in Scotland, and longer term impacts on productivity and growth across the industry and our supply chain. We believe the tariff will also have a cumulative impact on consumer choice.
“We believe it is imperative that the EU and US now take urgent action to de-escalate the trade disputes that have given rise to these tariffs.”
Gary Smith, GMB Scotland Secretary, added, “This is a troubling glimpse into the post-Brexit future and everyone with the Scottish economy’s best interests at heart should be concerned about our prospects following this development.
“Scotland and the rest of the UK are sitting ducks after October 31st. The collective strength we have in the EU trading bloc will be gone and there is simply no such thing as a ‘special relationship’ with the United States – Trump will squeeze the UK economy for everything he can get.”
Chair of the Malt Whisky Trail, James Johnston, said of the move, “This ruling is unwelcome but the quality, consistency and character of the Speyside malt defines the uniqueness of a product which will continue to stand up in economically challenging situations.
He continued, “The Scottish food and drink sector has grown three times faster than the rest of the Scottish economy over the past decade and is responsible for over half of all manufacturing jobs along the Malt Whisky Trail.
“However the remarkable growth of the sector is down to its success in opening up new overseas markets, underpinned with unquestionably high-end products. Keeping it all in context, whilst the US may impose new tariffs, sales to new markets such as China and the Middle East are booming.”