Spirits Tariffs Put a Strain on U.S. Consumers & the Hospitality Industry
Chris Swonger, President & CEO, the Distilled Spirits Council of the U.S.
Ongoing trade tensions have put distilled spirits back in the tariff crossfire just as U.S. bars, restaurants and retailers enter their busiest season.
For full-service restaurants, alcohol sales account for approximately 21% of their total sales, according to the National Restaurant Association, and it’s estimated that distilled spirits make up around 45 to 50% of those beverage alcohol sales.
Tariffs can cut into these profits by raising the cost of a bottle and a cocktail on the menu.
As a result, consumers pull back. Bar owners cut shifts. Restaurants tighten margins.
According to Distilled Spirits Council analysis, the 15% tariff on EU spirits alone could mean $1 billion lost in U.S. sales and 12,000 American jobs gone.
In a season that’s supposed to be about gathering and celebration, tariffs make it harder for everyone to raise a glass.
Bourbon, the Spirit of America, needs protecting, too
As tariffs squeeze hospitality businesses, they are also threatening American distillers who are bracing for the possibility that the EU will reimpose retaliatory tariffs on U.S. spirits in February 2026.
From the earliest days of our Republic, distilling has been part of America’s story. George Washington didn’t just lead a nation — he also ran one of the largest whiskey operations of his time at Mount Vernon. He understood that craftsmanship and commerce could build a country.
Nearly two and a half centuries later, that same spirit endures. More than 2,200 distilleries in all 50 states now carry on that legacy, creating world-class products, supporting hundreds of thousands of American jobs, and fueling a $37 billion industry built on heritage, grit and hospitality.
But this American success story is under strain as a result of these ongoing trade tensions. According to the Distilled Spirits Council’s 2025 Mid-Year Export Report, U.S. spirits exports dropped 9% in the second quarter. Shipments to Canada collapsed 85%, and exports to the EU, U.K. and Japan each fell by more than 20%. Many provinces in Canada still refuse to put American spirits on their store shelves.
For an industry that depends on open markets, those numbers dampen the spirit. As export opportunities dry up, U.S. distillers face difficult decisions, and some have even been forced to shut their distillery doors for good.
A trade model that worked — and can again
For more than two decades, spirits trade followed a simple principle: zero-for-zero. No tariffs on either side. Fair, reciprocal trade. Let quality and demand decide.
The results spoke for themselves: spirits exports quintupled to $2.4 billion by 2024.
When the EU imposed a 25% tariff in 2018, American Whiskey exports plunged 20%. When tariffs were suspended in 2022, exports rebounded 60% in a single year.
That’s proof — not theory — that free trade fuels growth and tariffs stunt it.
Why this matters
Bourbon, Tennessee Whiskey, Scotch, Tequila and Cognac are more than global products; they’re distinctive expressions of place protected by their country of origin. You can’t make Bourbon in Berlin or Scotch in Kentucky.
Tariffs on distilled spirits don’t protect American jobs — they punish American craftsmanship and the unsung heroes of the hospitality industry who bring these products to life. At a time when affordability is top of mind, especially during the holiday season, removing the 15% tariff on EU spirits would bring welcome relief to U.S. consumers and support U.S. restaurants, bars and retailers.
A return to zero-for-zero trade would secure American jobs and give distilleries, large and small, room to thrive and the confidence to make long-term investments here at home. It’s a win from the farmer who grows the grain, to the distiller who crafts the spirits, to the bartender who serves that special cocktail to the guest.
Let’s get back to what works and toast to a season of progress, prosperity and keeping spirits bright.
