Effective Oct. 18, the United States will impose 10% tariffs on new aircraft from France, Germany, Spain, and the United Kingdom and 25% on other industrial and agricultural products (more than 150 goods) from the European Union as part of a World Trade Organization (WTO) penalty award in a long-running aircraft subsidy case.
The WTO determined that the U.S. may impose up to $7.5 billion annually in countermeasures against the EU due to its failure to fully comply with a previous WTO ruling against subsidies it provided to aircraft manufacturer Airbus.
Among the products that will be subject to the additional 25% tariff are the following:
- single-malt Irish and Scotch whiskies from the UK
- sweaters, pullovers, sweatshirts, performance outerwear, suits, pajamas, swimwear, blankets, and bed linen from the UK
- axes, tweezers, pliers, metal cutting shears, pipe cutters, screwdrivers, knives, hand tools, and welding equipment from Germany
- printed books, lithographs, and pictures from Germany or the UK
- self-propelled machinery from Germany or the UK
- liqueurs and cordials from Germany, Ireland, Italy, Spain, or the UK
- olives and wine from France, Germany, Spain, or the UK
- certain pork, cheese, yogurt, butter, cherries, peaches, pears, oranges, lemons, clams, mussels, and other agricultural goods from most EU member countries
Full listing of goods affected here: EU Product Tariff Listing
Tariffs will only be lifted “when the EU ends these harmful subsidies", the USTR has previously stated. A ‘carousel’ retaliation is also being considered by the U.S., where targeted goods would regularly be shifted around.
Although a final decision is not expected until sometime in 2020 regarding the WTO case against U.S. subsidies to Boeing, the EU is threatening to respond with higher tariffs of its own and impose them outside of this case.
$319 billion U.S. goods were sent to EU countries combined in 2018, making them the largest American export market. $488 billion in products were imported by the U.S. from the EU. EU nations combined are America’s second-largest supplier of goods.
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