Kentucky bourbon tax to impact businesses

FRANKFORT, Ky. (WKYT) – The Kentucky Distillers Association says that starting Jan. 1, the European Union is set to hit their industry with a 50% tariff on all whiskey exports.

Jack Mazurak with the Kentucky Distillers Association says this Christmas, their distilleries are hoping for a miracle.

“To see really needlessly high tariffs re-imposed at a doubled rate, would be disastrous for our industry,” Mazurak said.

European tariffs were first imposed in 2018 at 25% in retaliation to U.S. tariffs on aluminum and steel.

Mazurak says that lost the industry hundreds of millions of dollars in exports, and it affects bourbon’s production at every turn.

“That means corn produced by our local farmers, barrels, staves. A lot of our supply chain for bourbon is also here in Kentucky and that’s why companies choose to come here,” he said.

WKYT reports that Mazurak says the re-imposing of these tariffs impacts more than just the bourbon industry – it could lead to less visitors to Kentucky to learn about all it has to offer.

“Our tourism is becoming more and more international,” Mazurak said. “That’s a lot of income for counties and cities and the state to have people coming in from all over the world.”

The bourbon and spirits industries continue to flourish at the moment, supporting 35,000 Kentucky jobs and $14 million in state economic activity.

“Overall, the industry is very hopeful,” Mazurak said. “Our production is going up, we’re putting away more barrels to age. But we want to be able to share that with the world.”

At the least, Mazurak said he hopes for another two-year suspension of the tariffs.