China raises import tariffs on vermouth, spirits amid trade dispute 

CHINA – China has more than doubled import tariffs on vermouth and certain wines in small containers from 14 to 30 percent, effective January 1, 2025, according to statements from the State Council Tariff Commission and the US Foreign Agricultural Service. 

The country has also removed its provisional 5 percent tariff on brandy and whisky, meaning these spirits will now be subject to the standard 10 percent most-favored nation (MFN) tariff rate. 

The revised tariffs will significantly increase the overall tax burden on imported alcohol. For vermouth, the total tax—including excise and value-added taxes—will rise from 42.13 to 63.22 percent, marking a 21.09 percentage point increase.  

Meanwhile, for whisky and brandy, the total tax burden will climb from 48.31 percent + 0.912 RMB per liter to 55.38 percent + 0.912 RMB per liter, according to Vino Joy. 

Brandy imports, particularly from France’s Cognac region, have already suffered from rising tax pressures. In 2024, Cognac shipments to China dropped by 23.8 percent year-on-year. The latest tariff adjustments are expected to further impact brandy sales in the country. 

China’s decision to increase taxes on vermouth, brandy, and whisky is widely seen as part of an ongoing trade conflict between Chinese and European officials.  

However, Australia, Chile, and Georgia remain exempt from the new tariffs due to their free trade agreements with China. 

The worst affected nations by the vermouth tariff hike are expected to be France, Spain, and Italy, which together account for 65 percent of the world’s vermouth exports, valued at US$500 million annually. 

Despite its global significance, vermouth represents a small segment of China’s alcohol market, accounting for only 0.15 percent of total wine imports in 2024.  

China imported 622,066 liters of vermouth worth US$2.5 million that year, reflecting 5.66 percent growth in volume and a 24.66 percent increase in value from 2023. 

Italy remained China’s top vermouth supplier, exporting 227,584 liters worth US$1.14 million, a 41.86 percent rise in volume and 67.9 percent increase in value year-over-year. Other key suppliers included France, Spain, Germany, and Moldova. 

Martini, a Bacardi-owned brand and a leading vermouth player in China, is expected to be among the most affected by the tariff increase. 

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