U.S. Distilled Spirits and Retaliation: Impact on Texas

U.S. Distilled Spirits and Retaliation:

Impact on Texas
The distilled spirits sector has a significant economic impact in the state of Texas, representing approximately 83,000 in-state jobs, $7.5 billion in economic activity; and $863 million in state and local taxes. According to the U.S. Census, in 2017 Texas exported $375 million in distilled spirits to the world. Approximately $38 million of these exports are the target of retaliatory tariffs. The details of the retaliation and export levels are provided below.

European Union
The EU is imposing a retaliatory tariff of 25% on all U.S. whiskey imports in response to the steel and aluminum tariffs. Total U.S. spirits exports to the EU in 2017 were valued at $789 million; U.S. whiskey accounted for approximately 85 percent of that total, or $667 million.

Texas’s exports of whiskey to the EU were valued at $36 million in 2017.

Canada
Canada is imposing a retaliatory tariff of 10% on all U.S. whiskey imports in response to the steel and aluminum tariffs. In 2017, total U.S. whiskey exports to Canada were valued at $48.7 million.

Texas’s exports of whiskey to Canada were valued at $8,000 in 2017.

Mexico
Mexico is imposing a retaliatory tariff of 25% on U.S. whiskeys. In 2017, total U.S. whiskey exports to Mexico were valued at $13.4 million.

Texas’s exports of whiskey to Mexico were valued at $25 million in 2017.

Turkey
Turkey is imposing a 70% tariff on all U.S. distilled spirits imports in response to the steel and aluminum tariffs. In 2017, Turkey imported $21 million in spirits from the United States; of this $20.2 million was whiskey.

China
China is imposing a retaliatory tariff of 25% on U.S. whiskeys in response to the Section 301 actions.  American spirits exports to China have grown by almost 1,200 percent, from $959,000 in 2001 when China joined the World Trade Organization (WTO) to $12.8 million in 2017; of this, $8.9 million was whiskey.

Texas’s exports of whiskey to China were valued at $4,000 in 2017.

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