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Trump Tariffs to Hit Canadian Whisky
President-elect Donald Trump plans to use his emergency powers to impose a 25% tariff on all imports from Canada and Mexico upon taking office in January. The tariff would hit Canadian whisky makers, since the U.S. is the largest market for Canadian whisky sales.
Trump cited what he calls a flood of illegal immigrants and fentanyl crossing both borders into the U.S., and said both countries would have to pay a penalty until the illegal trade stops. Since tariffs are a tax on goods paid by the importer, the tariffs would actually hurt American businesses.
“At the end of the day, tariffs on spirits products from our neighbors to the north and south are going to hurt U.S. consumers and lead to job losses across the U.S. hospitality industry just as these businesses continue their long recovery from the pandemic,” Distilled Spirits Council CEO Chris Swonger said in a statement. Swonger expressed fears that both countries will retaliate with tariffs of their own targeting American whiskies and other spirits.
Canadian whisky sales have been slumping in the U.S. over the last decade, peaking at $312.1 million in 2014 and falling to $202.5 million in 2023, a 5.9% decline over 2022. Canada also ranks as the second largest export market for American spirits, with $255 million in exports crossing the border in 2023. Under the United States-Mexico-Canada trade agreement, Canadian Whisky is a distinctive product of Canada, meaning that it cannot be produced in the U.S., which would alleviate the desire to protect U.S. manufacturing jobs. The agreement was negotiated during the first Trump Administration, and is scheduled to be re-negotiated in 2026.
The tariffs are expected to hurt companies like Diageo, which makes the number-one selling Canadian whisky in Crown Royal, and Suntory Global Spirits, the owner of Canadian Club. Spokespersons for Diageo have not responded to our requests for comment on the tariffs, while a Suntory spokesperson deferred comments to the industry’s trade associations on both sides of the border.
This story will be updated with additional information as needed.
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