JOBS in the Scotch whisky industry may be put at risk and sales could drop by 20% within a year due to new tariffs on exports to the US, it is claimed.

Karen Betts, chief executive of the Scotch Whisky Association (SWA), described the 25% penalty levied against single malts from today as “bad news”.

The US proposed the tariffs on £6.1 billion of EU exports in retaliation to the bloc’s illegal subsidies to plane-maker Airbus.

European cheeses, olives and aircraft have also been targeted by the penalties, which will be paid by importers when goods are being brought across the US border.

It is estimated America represents 10.8% of the global volume of Scotch whisky and 22% of global value.

Betts said: “This is very bad news for our industry. It means that Scotch whisky is now paying for over 60% of the UK’s tariff bill for the subsidies it provided to Airbus, eight times more than the next most valuable UK product on the tariff list. That single malts are being targeted is particularly damaging for smaller producers, who stand to be the hardest hit.

“Scotch whisky has been imported tariff-free to the US for the last 25 years. This move undermines decades of hard work and investment which has seen Scotch whisky sales boom in the US.”

The SWA says the industry could lose as much as 20% of its sales to the US – currently worth £1bn – in the next 12 months.

Betts added: “In time, consumer choice will diminish and Scotch whisky companies will start to lose market share. In Scotland and throughout our UK supply chain, we expect to see a dropping-off in investment and productivity. Ultimately, jobs could be at risk.”

She urged the UK and Scottish governments to step in and help the industry maintain its competitiveness globally while continuing work to have the tariffs scrapped.

She said: “We now need the UK and Scottish governments to work together to ensure distillers can weather the storm. We want them to consider a range of support to the industry, including reducing the UK tax burden on Scotch whisky in the autumn Budget.”

Spirits company Diageo said it will be taking “mitigating actions” to counter the effects of the tariffs and it does not foresee a major impact.

Scotland Office minister Colin Clark said: “The UK Government has raised the issue at the highest levels with both the EU and the US, including with President Trump, and will continue to do so until these tariffs are dropped.”