The Bloomberg news agency has cited a notice published by the Office of the US Trade Representative (USTR) as saying on Wednesday that Washington is mulling introducing tariffs on exports from France, Germany, Spain, and the UK worth about $3.1 billion.
According to the notice, the USTR's tariffs may be slapped on such European exports as beer, gin, olives, and trucks, with possible increases in duties on aircraft, cheese, and yogurt.
The reported move comes after the US Distilled Spirits Council expressed concern over any new spirits tariffs, saying that it may "escalate trade tensions across the Atlantic and further jeopardise American companies and hospitality jobs already under duress as a result of COVID-19".
The statement followed EU Trade Commissioner Phil Hogan telling European trade ministers earlier in June that the US "has stepped back from the settlement talks in recent weeks", in an apparent nod to the ongoing Washington-Brussels aircraft subsidy spat.
This pertains to the World Trade Organisation (WTO) previously blaming both the EU and the US for illegally supporting their aircraft industries.
"If this remains the case, the EU will have little choice but to exercise its retaliation rights and impose our own sanctions", Hogan pointed out.
He spoke after American Trade Representative Robert Lighthizer cautioned in May that "there is no valid basis for the EU to retaliate against any US goods", adding that Washington would "continue to press the EU to negotiate a resolution that respects the WTO’s findings".
US-EU Tariff Dispute Over Aircraft Subsidies
This followed, the USTR saying in a press release in December 2019 that they will consider imposing new tariffs on products from the EU after a WTO investigation confirmed that EU aid to Airbus has hurt the American aircraft industry.
"In light of […] the lack of progress in efforts to resolve this dispute, the United States is initiating a process to assess increasing the tariff rates and subjecting additional EU products to the tariffs", the press release said.
According to the USTR, the WTO earlier ruled that the EU had failed to abide by an order to end the illegal subsidies, which the US previously said had cost its aerospace industry about $7.5 billion.
On 18 October 2019, the WTO formally approved Washington's request to impose 10 percent tariffs on large civil aircraft and 25 percent tariffs on agricultural and other products, with most of these duties being applied to imports from France, Germany, Spain, and the UK.
The dispute has been in place since the mid-2000's when a complaint was lodged under then-US President George W. Bush, but leaders on both sides have been reluctant to take any measures against crucial allies. It appears that incumbent Donald Trump has proven more willing to limit access to lucrative US markets and consumers in order to win more advantageous trade deals for the country.
