China doubles tariffs on whisky, vermouth and brandy
China's latest round of tariff increases come as a blow to alcohol categories including whisky, brandy and vermouth as trade tensions continue. The post China doubles tariffs on whisky, vermouth and brandy appeared first on The Drinks Business.
China's latest round of tariff increases come as a blow to alcohol categories including whisky, brandy and vermouth as trade tensions continue.
China has more than doubled its import tariff on vermouth and “other wine in small containers” from 14% to 30%, according to statements issued by China’s State Council Tariff Commission and the US Foreign Agricultural Service.
The country is also removing its provisional 5% tariff on brandy and whisky, meaning both categories will now be subject to the 10% most favoured nation (MFN) tariff rate.
China's decision to raise tariffs has applied to imports entering the country from 1 January 2025.
The total tax burden on vermouth, when combined with excise and value-added taxes, will jump from 42.13% to 63.22%, marking a 21.09% point increase, according to Vino Joy.
For whisky and brandy, the total tax burden on these spirits will rise from 48.31% + 0.912 RMB per litre to 55.38% + 0.912 RMB per litre.
Brandy imported from the EU is already suffering under the weight of significant tax increases in China. France's Cognac region has been the worst affected, with Cognac shipments to the Chinese market dropping 23.8% year-on-year in 2024 due to the increased tax burden.
China's move to increase tariffs on brandy, vermouth and whisky is likely linked to an ongoing trade war between Chinese and European officials. Australia, Chile and Georgia will remain exempt from the alcohol tariffs as all three have tree trade agreements with China.
France, Spain and Italy will be worst affected by the high tariffs on vermouth, as these three countries account for 65% of the world's vermouth exports, worth US$500 million annually.
However, vermouth makes up a very small section of the Chinese drinks market, accounting for 0.15% of total wine imports in 2024, according to Vino Joy.
In 2024, China imported 622,066 litres of vermouth worth US$2.5m, an increase of 5.66% in volume and 24.66% in value from the previous year, based on customs data.
China has more than doubled its import tariff on vermouth and “other wine in small containers” from 14% to 30%, according to statements issued by China’s State Council Tariff Commission and the US Foreign Agricultural Service.
The country is also removing its provisional 5% tariff on brandy and whisky, meaning both categories will now be subject to the 10% most favoured nation (MFN) tariff rate.
China's decision to raise tariffs has applied to imports entering the country from 1 January 2025.
The total tax burden on vermouth, when combined with excise and value-added taxes, will jump from 42.13% to 63.22%, marking a 21.09% point increase, according to Vino Joy.
For whisky and brandy, the total tax burden on these spirits will rise from 48.31% + 0.912 RMB per litre to 55.38% + 0.912 RMB per litre.
Brandy imported from the EU is already suffering under the weight of significant tax increases in China. France's Cognac region has been the worst affected, with Cognac shipments to the Chinese market dropping 23.8% year-on-year in 2024 due to the increased tax burden.
China's move to increase tariffs on brandy, vermouth and whisky is likely linked to an ongoing trade war between Chinese and European officials. Australia, Chile and Georgia will remain exempt from the alcohol tariffs as all three have tree trade agreements with China.
France, Spain and Italy will be worst affected by the high tariffs on vermouth, as these three countries account for 65% of the world's vermouth exports, worth US$500 million annually.
However, vermouth makes up a very small section of the Chinese drinks market, accounting for 0.15% of total wine imports in 2024, according to Vino Joy.
In 2024, China imported 622,066 litres of vermouth worth US$2.5m, an increase of 5.66% in volume and 24.66% in value from the previous year, based on customs data. 
