Trade tensions with the EU continue to rise as the U.S. introduces higher tariffs on aircraft parts and alcoholic beverages. The move is yet another volley in a 16-year dual over subsidies for Boeing and Airbus involving the WTO. 

The United States Trade Representative announced this week that Section 301 tariffs will raise for a range of goods from the EU. The move is a response to Europe’s own recently imposed tariff hikes. In total, the duty increases are set to affect approximately $7.5 billion worth of goods from France and Germany.  

USTR has framed these actions as a response to the EU’s tariff increases on US goods in September. Responding to an ongoing WTO dispute over subsidies for Airbus and Boeing, the EU established new tariff rates on $4 billion worth of US goods.  

The USTR claims that the EU tariff increases were skewed by its use of trade data from the early parts of the coronavirus pandemic timeframe. Per the Trade Representative release, Europe had “imposed tariffs on substantially more products than would have been covered if it had utilized a normal period.” The USTR claims these revised tariffs are unfairly punitive because of the atypical trade data pool.  

The U.S. responded with its own tariff increases on EU products. According to a release from the USTR, these tariff hikes will revolve around airplane manufacturing components as well as some alcoholic products from France and Germany. 

A new Federal Register notice states that the tariff revisions will take effect January 12, 2021. Businesses importing affected goods will need to pay the updated duties starting 12:01 a.m. on this date. If you have questions or concerns about complying with updated EU tariffs, reach out to your representative at Scarbrough International.