SMALL BUSINESS LETTER TEXT:
Dear Secretary Lutnick, Secretary Bessent, and Ambassador Greer:
As you begin your tenure, we hope you will consider our plight. We are the owners of restaurants, bars, hotels, and shops from across our nation. In every state and every town, we share the same pride in what we have built, and our role in our local economies and communities. We are gathering places in times of celebration and times of challenge. We bring life to main streets and employ millions of Americans from every walk of life.
The last several years have been brutal to our industry with shutdowns, inflation, labor shortages, and tariffs. What we have built, and who we employ, while never guaranteed, continues to face challenges, and we’re asking that you help us protect the investments we as an industry make to the national labor force by protecting our ability to buy and sell affordable imported wine. Between 2019 and 2021, 25 percent tariffs on most wine from Europe hurt us badly.
Tariffs on European wines disproportionately hurt American companies. Since the wine in our establishments is purchased from an American distributor that bought the wine from an American importer, for every dollar Europeans make selling wine to the U.S., we make $4.50. For full-service restaurants, beverage accounts for about one-third of revenue, and wine sales account for up to 60 percent of gross margins. Our customers desire the wines that align with our menus and when the price is too high, they often just skip the purchase. Alternatively, our margins on that profit center we require to stay in business is further squeezed. Selling imported wine keeps our establishments open, hiring, and growing.
From 2019 to 2021, we lost sales and investment and halted expansion plans. We had nothing to do with the dispute that brought the tariffs, but we bore the brunt of the retaliation, with tariffs hitting over $3 billion worth of wine. The wine tariffs were a failure. European producers found other markets and the EU continues to subsidize its aircraft.
We recognize that you intend to address major trade policy concerns with the European Union and other countries, but wine should not be on any future tariff list. Baseline wine tariffs are less than a quarter of a dollar per bottle in both the US and the EU. Our livelihoods, your constituents’ jobs, and the health of the hospitality industry at large, are counting on them staying that way.
Sincerely,