Group urged USTR for exemption of wine and spirits products from Section 301 tariffs
The Toasts Not Tariffs Coalition, representing 58 associations across the three-tier U.S. alcohol industry and related sectors, submitted formal comments to the U.S. Trade Representative (USTR) in response to its Section 301 investigations into foreign industrial overcapacity, a process that could lead to new or expanded tariffs.
In its submission, the coalition urged the administration to take a number of actions to support the struggling U.S. hospitality sector by: exempting wine and distilled spirits from any current or future tariffs; securing fair and reciprocal trade with the European Union (EU) and United Kingdom (UK) among others; securing new market opening agreements; and securing the permanent return of U.S. wines and spirits across all of Canada’s provinces.
“Protecting, preserving and securing fair and reciprocal access to global markets will enable the entire U.S. hospitality sector to drive manufacturing growth, increase exports and support job creation across the supply chain, from farmers, distillers and vintners to restaurants, bars, and retail stores and everyone in between,” said the coalition.
U.S. Hospitality Sector Faces Mounting Economic Pressures
The coalition highlighted that the U.S. hospitality sector is confronting significant economic headwinds, including persistent inflation, high food costs, declining consumer confidence and fragile employment growth that has yet to fully recover six years after the pandemic.
They pointed out that restaurants, which already operate on thin margins, are especially vulnerable to rising costs and trade uncertainty.
More than 3.5 million U.S. jobs are supported through the production, distribution, and sale of wine and spirits, generating $476 billion in annual economic activity. Alcohol sales alone account for 21% of full-service restaurant revenue, underscoring how tariffs on wine and spirits can disproportionately harm hospitality businesses.
The U.S. Wine and Spirits Sector Has Thrived with Fair and Reciprocal Trade
The vast majority of U.S. wine and spirits exports have flowed to markets with low or zero import duties, enabling U.S. producers to compete on a level playing field in key markets abroad.
“For decades, our sectors have been a model of how fair, predictable, and reciprocal trade can support jobs, investment, and economic growth across rural and urban communities,” said the coalition.
“The U.S. distilled spirits and wine sectors are now facing mounting global challenges that have negatively impacted their competitiveness and long-term growth. Nowhere was the success of fair and reciprocal trade and the mounting global challenges more evident than in Canada, long one of the most important and reliable export markets for U.S. wine and spirits.”
Canada’s ban on U.S. wine sales drove an unprecedented drop in exports. U.S. wine exports to Canada declined by 78%, from $460 million in 2024, which accounted for 36% of total U.S. wine exports, to $103 million. Canada alone accounted for 81% of the decline in total U.S. wine exports. U.S. spirits exports to Canada fell 63%, from $238 million in 2024 to $88 million in 2025, a decline of $149 million.
“The significant damage to U.S. alcohol brands in Canada caused by this trade dispute will have lasting negative impacts on U.S. producers,” said the coalition.
Wine and Spirits Are Unique Products
The coalition stressed that wine and spirits are unique products, often tied to specific geographic regions.
“Many U.S. and imported spirits are recognized as ‘distinctive products’ and can only be made in their designated countries—Bourbon and Tennessee Whiskey in the U.S., Cognac in France, and Tequila in Mexico,” said the coalition. “Similarly, wine is linked to its place of origin through American Viticultural Areas, appellations of origin or geographical indications. Consequently, production of these products cannot simply be relocated to circumvent tariffs.”
Tariffs on Imported Spirits and Wines Threaten U.S. Exports
The coalition stressed that the continued use or threat of tariffs on imported spirits and wines increases the likelihood of retaliatory measures against U.S. spirits and wine exports, placing U.S. producers, farmers and workers at risk.
“Tariffs and the uncertainty they create not only restrict access to key export markets but also delay investment decisions, suppress job growth and limit the industry’s ability to expand globally,” the coalition said.
