Recently, the European Union officially imposed tariffs on about $3.99 billion of goods and services exported to Europe, of which 15% were taxed on aircraft and parts, and 25% were taxed on tobacco, nuts, spirits, motorcycle parts, etc. Recently, Europe and the United States have been in conflict over aviation subsidies, digital taxes and other conflicts, and the trade disputes between the two sides are difficult to resolve.
Since October last year, the United States has repeatedly imposed tariffs on agricultural products, industrial products and services exported to the United States. Affected by the COVID-19 epidemic, some European and American enterprises have been greatly impacted, and this increase in tariffs is undoubtedly to make things worse. In the aviation industry, for example, Airbus’s sales volume was 11.313 billion euros in the third quarter of this year, a year-on-year decline of 27%; Boeing’s commercial aircraft shipments were only half of that of the same period last year, and maintenance and other services revenue also fell by about 20%.
The European Union imposed tariffs on goods and services in the United States because the United States illegally subsidized Boeing. The dispute between the European Union and the United States on aviation subsidies began in 2004. The two sides filed lawsuits with the WTO, accusing each other of providing subsidies to their respective airlines in various forms of violation of regulations. In response, the WTO ruled that both the United States and the European Union have the problem of providing illegal subsidies to their respective aviation enterprises.
In October 2019, the WTO authorized the United States to impose tariffs on about $7.5 billion of EU goods and services exported to the United States every year. The United States immediately taxed 10% on aircraft and spare parts imported from the European Union and 25% on oranges, alcohol, cheese, olive oil, etc. In March this year, the United States raised the tax rate on aircraft and spare parts imported from the European Union to 15%. In October this year, the WTO officially authorized the EU to impose tariffs on U.S. goods and services not exceeding $3.99 billion a year.
Relevant industries in Europe and the United States that have been included in the list of additional tariffs hope to resolve the dispute as soon as possible. The Scotch Whiskey Association said that the 25% tariff imposed by the United States has caused a sharp decline of 32% in revenue from products exported to the United States this year, causing a loss of £360 million. Swanger, chairman of the U.S. Distillation Liquor Council, said that the new EU tariffs have put the American spirits industry, which has been hit by the epidemic, face new shocks.
German American Chamber of Commerce President Spertori believes that the two sides should get rid of the current “tout for tat” situation. German Federal Minister for Economy and Energy Altmeier said he hoped to find a “friendly solution” in the lawsuits between Airbus and Boeing. The European Commission Executive Vice President Dombrowski said that the EU will continue to open the door to a negotiated settlement and that “the EU will also terminate or withdraw the punitive measures at any time if the United States suspends or withdraws punitive tariffs on the EU”.