The Scotch Whisky Association (SWA) has urged the US and UK governments to eliminate the 25% retaliatory tariffs on spirits, which is costing millions in exports.

Government officials of both the countries will begin formal talks on the US-UK free trade agreement this week.

SWA chief executive Karen Betts said: “We are very pleased that formal trade negotiations have begun between the UK and the US governments. Now more than ever, keeping trade free, fair and flowing will be key to the UK’s recovery as we grapple with the human and economic costs of Covid-19.

“For Scotch Whisky, the 25% tariff imposed last year by the US government on exports of Single Malt is hitting producers hard, with exports to the US down 27% in the final quarter of 2019. Just as the EU tariff on American whiskey continues to hit American producers hard.”

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The tariffs were imposed in October last year on Scotch Whisky exports due to a trade dispute over aircraft subsidies, which resulted in 27% decline of exports during the final quarter of 2019.

SWA wants the negotiators to reach an agreement to remove all tariffs on whisky, which will help the UK spirits industry.

Betts further added: “The difficult situation we are in on tariffs has now become much harder as our industry copes with the impact of the Covid-19 crisis too.

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“With lockdowns across the US and Europe – critical for slowing the spread of the Covid-19 and saving lives – bars, restaurants and other venues have closed, which is very serious for the fabulous hospitality businesses we have worked with for many years and the people who work in them.”