Is your favorite European wine or beer about to get 200% more expensive? How Trump's huge new tariff threat could affect U.S. consumers and businesses.

On Thursday morning, President Trump took to Truth Social to threaten massive 200% tariffs on “all WINES, CHAMPAGNES, & ALCOHOLIC PRODUCTS COMING OUT OF FRANCE AND OTHER E.U. REPRESENTED COUNTRIES.”

Trump has spent the last few months teasing, delaying, imposing — and occasionally even retreating from — big taxes on friends and foes alike: a 25% tariff on certain Canadian and Mexican imports here, two rounds of 10% tariffs on Chinese goods there.

But Thursday’s outburst was the first time the president has floated such an enormous levy on any of America’s trading partners.

What provoked Trump’s 200% threat — and what could happen to the cost of, say, a can of Heineken if he actually follows through? Here’s everything you need to know.

Why Trump is threatening a 200% tariff on European booze

Strangely enough, it doesn’t have much to do with the actual U.S.-EU spirits industry, which has been a “model for fair and reciprocal trade” with “zero-for-zero tariffs” since 1997, as Chris Swonger, leader of the Distilled Spirits Council of the United States, pointed out in a statement Thursday. Between 1997 and 2018, transatlantic sales of wine, beer and liquor shot up 450% as a result.

The problem is that messing with alcohol prices tends to attract a lot of public (and therefore political) attention — making it a convenient target in any trade war.

For instance, when Trump imposed tariffs on imported steel and aluminum during his first term, the EU retaliated, in part, with a 25% charge on American whiskey. The goal? To put pressure on then-Senate Majority Leader Mitch McConnell, a Republican from Kentucky (aka the home of American bourbon). The U.S. hit back with 25% tariffs on European liquors and wines.

The Europeans suspended their whiskey tariffs under the Biden administration, but they never took them off the table entirely. As long as Trump’s steel and aluminum tariffs didn’t return, the status quo would continue. But if Trump were to bring his tariffs back, the EU had already announced it would resume taxing U.S. whiskey on March 31, 2025 — at 50%, double the previous rate.

The point was to avoid another trade war.

Which brings us to Trump 2.0. On Wednesday, Trump imposed sweeping 25% tariffs on every country that sells steel and aluminum to the U.S. — including many European nations. The EU responded as promised: by moving forward with plans to tax U.S. whiskey at 50% as part of a $28 billion package of retaliatory tariffs targeted at states with strong Trump support.

As predictable as this tit-for-tat might have been, Trump was apparently peeved.

“The president was totally annoyed that the Europeans did this,” Commerce Secretary Howard Lutnick told Bloomberg Television. “Why are Europeans picking on Kentucky bourbon? ... It’s disrespectful.”

“Nasty,” Trump added on Truth Social. He then went on to call the European Union “one of the most hostile and abusive taxing and tariffing authorities in the World,” claiming it was “formed for the sole purpose of taking advantage of the United States.”

A 200% tariff on European alcohol, he added, “will be great for the Wine and Champagne businesses in the U.S.”

Would this actually ‘be great for the Wine and Champagne businesses in the U.S.’?

Trump has long insisted that tariffs will level the proverbial playing field by incentivizing companies to retain American workers and ramp up U.S. manufacturing — all while funneling “trillions” of dollars in new revenue to the federal government.

“Tariffs are gonna make us rich as hell,” he said in January. “They’re gonna bring our country’s businesses back that left us.”

Yet nearly all economists disagree with Trump’s take, noting that a tariff is actually an import tax paid by the company doing the importing — not by the foreign country (or foreign business) sending its goods to the U.S.

The same experts have found that most importers simply pass the added cost of tariffs on to U.S. consumers by jacking up their prices. Then other countries retaliate with tariffs of their own, risking a global trade war and recession.

What does this mean in the alcohol world? A lose-lose situation. During Trump’s last trade war over booze, from 2018 to 2021, American whiskey exports to the EU fell 20 percent; EU liquor and wine exports plummeted as well. It simply became too expensive for some businesses to trade in those products — on both sides of the pond.

According to the New York Times, it was a “setback” that “damaged the industry for years” — while “the threat of tariffs has continued to hamper its expansion.”

And that was just from 25% tariffs. Levies as high as 200% would be a whole different story.

So what happens next?

It’s possible that Trump’s 200% European booze tariff will never become a reality. The European trade commissioner reportedly reached out to his American counterparts after the EU’s announcements on Wednesday — and calls were “being prepared.”

But unless Trump backs down from his steel and aluminum tariffs, the EU is unlikely to retreat from its whiskey tariffs — meaning the president will be forced to decide whether or not to follow through on Thursday’s threat and escalate the transatlantic alcohol wars to a previously unthinkable level.

“If you make him unhappy, he responds unhappy,” Lutnick said Thursday, referring to Trump.

A 200% tax on beverages such as Veuve Clicquot champagne, Pilsner Urquell beer and Domaine de Chevalier bordeaux would be prohibitive for any U.S. company that has built its business around importing them, or for any U.S. retailer — such as a liquor store, bar or restaurant — that has built its business around carrying them.

To avoid hemorrhaging money, the choice would be either to stop offering those products altogether or to charge customers roughly twice as much.

It’s possible, as Trump suggested on Truth Social, that equivalent U.S. beverages could fill the gap, at least somewhat. (Trump’s son Eric owns Trump Winery, which is based in Virginia.) But with a smaller market abroad and less foreign competition at home — Trump has also threatened Mexican tequila and Canadian whisky — domestic producers might choose to raise their prices too. And ultimately, nothing would stop the EU from hitting U.S. exporters with even bigger tariffs of its own.

“We urge President Trump to secure a spirits agreement with the EU to get us back to zero-for-zero tariffs, which will create US jobs and increase manufacturing and exports for the American hospitality sector,” Swonger, the Distilled Spirits Council leader, said in his statement. “We want toasts not tariffs.”