The French design bag is about to become much more loved to Americans, as it becomes a symbol of an ongoing political debate. USTR or USTR under President Trump’s leadership has been threatening price lists, up to 100 percent in some cases, in French luxury products ranging from cheese, wine, airplanes to designer accessories and cosmetics since last year. A Saturday announcement that it would impose a 25% tariff on imports worth $1.3 billion of bags and cosmetics without delay came on a Friday issued through the French government.
Sentiment adds to a war of words on virtual and taxes between the two countries that started with a virtual tax or a DST law that was passed in France in 2019. After a one-year investigation under segment 301 of the Trade Act 1974 of the French DST. , USTR announced its goal of continuing tariffs, claiming that the DST is “irrational or discriminatory and weighs or restricts U.S. trade,” according to the agency’s USTR-2019-0009 file. The end of the investigation and the announcement of the French government coincided.
Jon Gold, NRF’s Vice President of Supply Chain and Customs Policy issued this statement to me, “While we oppose the Digital Service Tax as announced by France, we are disappointed with administration’s continued use of tariffs. The U.S. should negotiate multilateral solutions and not place tariffs on U.S. imports, especially now as U.S. businesses and consumers are working through economic recovery from the coronavirus pandemic. Tariffs are taxes paid by U.S. companies and passed along to U.S. consumer.”
The resolution will go directly to French luxury giants LVMH, whose brands come with Louis Vuitton, Christian Dior, Céline, Fendi and Marc Jacobs, and Kering, which boasts Gucci, Saint Laurent, Balenciaga and Bottega Veneta among their luxury stars.
Fashion, leather goods, perfumery and cosmetics account for 41% and 13% of LVMH’s total sales. Of all this, the United States accounts for 18% of its fashion and leather goods business and 15% of its perfume and cosmetics business, which recorded total sales of approximately 22.2 million and 6.8 million euros in 2019, respectively. According to an annual report on its institutional website, sales of leather goods (excluding shoes) accounted for 55% of Kering’s results in 2019.
Independent French logos, such as the Longchamp and Jerome Dreyfus bags, and the Clarins cosmetics logo, would also be the subject of a possible increase in value as a result of the decision.
The proposed walk begins in 180 days unless negotiations between the two nations are resolved to the satisfaction of the party.
I am an award-winning American journalist in Paris spanning the luxury and fashion industries with over 25 years of experience. I spent more than 18 years in the industry.
I am an award-winning American journalist based in Paris covering the luxury and fashion industries with over 25 years of experience. I spent more than 18 years in the “bible” of the fashion and retail industry of WWD, also known as Women’s Wear Daily, where my rhythm was first sportswear, then accessories and jewelry for 14 years. My career has witnessed the transition from classic print media to the evolution of digital. In this role, I have gained deep wisdom from the global design, wholesale and retail markets, as well as the marketing that supports them. Along the way, I met countless creatives and other business people who create luxury from creation to point of sale with the consumer. I’m here in Forbes.com to tell their stories.