WASHINGTON _ That glass of Champagne being raised to welcome in the new year is about to get a lot more expensive.
Absent a major breakthrough in trade negotiations with France, the Trump administration is preparing to raise tariffs on a host of French products _ including cheeses, wines and Champagne _ by mid-January. That move might result in a 100% tax increase on France's key exports.
It is in response to a pending digital tax imposed by Paris on companies such as American giants Google, Facebook and Amazon. French officials believe the large tech companies have circumvented tariffs for years by developing headquarters in low-tax European capitals.
The U.S. move would severely affect the French wine industry and hit its sparkling wine varieties, which amount to over $775 million in exports to the United States each year, particularly hard.
American wholesalers, restaurateurs and business owners are warning the White House that its next round of tariffs could have a ripple effect well beyond the wine belt.
"These tariffs on EU wines and spirits are going to impact consumers across all price points, from entry-level spirits to luxury level," Michael Bilello, a senior vice president at Wine & Spirits Wholesalers of America, told McClatchy, warning that it could cost a significant number of American jobs.
"We're talking about a trade with 88,000 American jobs, over 370 family-owned American businesses in over 3,000 locations nationwide _ across every state and in every congressional district."
In October, the Office of the U.S. Trade Representative imposed a 25% tariff on select wines from France, Spain, Germany and the United Kingdom. That round of tariffs excluded sparkling varieties and wines with more than 14% alcohol. But the next round threatens to increase tariffs on all varieties, and on goods such as cosmetics, handbags and cheese.
