President Donald Trump's administration is considering a 50% tariff on Canadian spirits, a move that could impact the U.S. hospitality sector and potentially influence Canada's decision to remove American spirits from its provincial liquor stores.
Chris Swonger, president and CEO of the Distilled Spirits Council, stated that the proposed tariff could serve as leverage to encourage Canadian officials to allow American spirits back onto store shelves. He noted that Canada had previously removed American spirits in retaliation for earlier U.S. tariffs.
"First and foremost, great thanks to President Trump because he has recognized that our industry has lost 73% of our American distilled spirits exports to Canada as a result of the provincial ban of purchasing American distilled spirits," Swonger told Fox News Digital. "We are hopeful that an agreement will be made between the Trump administration and Canadian politicians to put American spirits back on the shelves."
The proposed tariff is part of an ongoing trade dispute between the two countries. In the past, Canadian provinces have boycotted American spirits in response to U.S. tariffs on Canadian goods. This has led to a significant drop in U.S. spirits exports to Canada.
According to DISCUS data, Canada was once the second-largest market for U.S. spirits but has fallen to sixth place. Exports dropped from $203 million in 2024 to $60 million in 2025, representing a decline of approximately $143 million. Kentucky, a major bourbon-producing state, has been particularly affected, with the Kentucky Distillers' Association reporting that the trade dispute threatens over 23,000 industry jobs.
While the tariff threat aims to pressure Canada, Swonger cautioned that it could also negatively affect the U.S. hospitality industry, which serves a significant amount of Canadian spirits. He added that the industry prefers free trade and would not want the tariffs to be implemented.
"We're an industry that thrives on zero-for-zero tariffs and zero trade barriers," Swonger said. He expressed hope that negotiations between the U.S. and Canada would lead to a resolution before the midnight deadline.
Canadian whisky, vodka, gin, rum, wine, and beer are among the products that could face the new levy. The dispute involves approximately $20 billion in Canadian imports, including liquor, dairy, vehicles, and hockey equipment.