GROSSE POINTE WOODS, Mich. (WXYZ) — Local businesses are bracing for a possible tariff of up to 100 percent on European goods ranging from handbags, to cheese and wines.
Michael Palazzolo with Woods Wholesale Wine in Grosse Pointe Woods says the tariff would hit the wine industry hard, doubling the price of some wines and leaving some in the wine industry jobless.
“It will start with the importers, then it will hit the distributors, and eventually it will hit us, and then finally by hitting the consumers,” he said.
The new threat of tariffs comes from the Trump administration after France imposed a “Digital Services Tax” on American tech companies such as Amazon and Apple.
The Office of The United States Trade Representative (USTR) in Washington has already held hearings on the proposed $2.4 billion tax on French cheese, Champagne, handbags and other goods.
The new tariff comes on top of the 25% previously imposed tax that went into effect in October, and it now includes Champagne, sparkling wines and Italian wines that were excluded from the first round.
Palazzolo says consumers who are used to certain wines may have to think about expanding their palette or they could be paying double. Take Cristal for example, a bottle at his shop normally costs $250 but could skyrocket to $500.
“It’s tricky situation Champagne, because if you want Champagne, you want real Champagne, it has to come from the Champagne region of France.”
While the tariff might seem to be a benefit for domestic winemakers, some say the ripple effect could increase the prices on wines from the Napa Valley.
The tariffs could go into effect as soon as the end of the month.