Discus: tariffs on spirits ‘will hurt US consumers’

Following president-elect Donald Trump’s pledge to slap 25% tariffs on all imports from Canada and Mexico, governments have been urged to work together to ensure they are not imposed on spirits products.

In a post on his social media platform Truth Social on Monday (25 November), Trump said he said he would “sign all necessary documents to charge Mexico and Canada a 25% tariff on all products coming into the United States” on his first day in office, as a result of “thousands of people pouring through Mexico and Canada, bringing crime and drugs at levels never seen before”.

The 25% tariff on all imports from Mexico would have a direct effect on both the Tequila and mezcal categories, while the tariffs on Canada would particularly impact the country’s whisky sector.

In a statement, Chris Swonger, CEO of the Distilled Spirits Council of the US (Discus), said the organisation appreciated president-elect Trump’s goal to protect the American people and US jobs, however the spirits industry has been “weighed down by retaliatory tariffs as part of unrelated trade disputes since 2018”, which has “crashed our exports harming thousands of distillers and their farmers across the United States”.

He continued: “We are now currently facing the threat of a devastating 50% tariff on American whiskey by the EU at the end of March 2025.

“Imposing a tariff on Tequila and Canadian Whisky from two of our largest trading partners could kick off more retaliatory tariffs on American spirits to Canada and Mexico.”

Earlier this month, Mexico’s economy minister, Marcelo Ebrard, said in an interview with local broadcaster Radio Formula: “If you apply tariffs, we’ll have to apply tariffs. And what does that bring you? A gigantic cost for the North American economy.”

‘Tariffs will not boost American jobs’

Swonger added: “Under the United States-Mexico-Canada Agreement (USMCA), Tequila and Canadian Whisky are designated as distinctive products, similar to Bourbon, where they can only be made in their country of origin. Slapping a tariff on Tequila and Canadian whisky will not boost American jobs simply because they cannot be produced in the United States.

“The US spirits sector continues to experience a slowdown. At the end of the day, tariffs on spirits products from our neighbours to the north and south are going to hurt US consumers and lead to job losses across the US hospitality industry just as these businesses continue their long recovery from the pandemic.

“As president-elect Trump comes into office, we urge all of governments to work together to reach an agreement that ensures tariffs are not imposed on spirits products.”

In 2023, the US imported US$4.6 billion worth of Tequila and US$108m worth of mezcal from Mexico.

In the same year, the US imported imported US$537m worth of Canadian spirits, US$202.5m of which was Canadian whiskey.

In 2023, Canada ranked as the second largest export market for US spirits, with exports reaching US$255m. Meanwhile, Mexico ranked as the third largest export market for US distilled spirits, totalling US$139m.