Brady Says Congress 'Stunned' That Biden Nixed PNTR Removal for Russia

The top Republican on the House Ways and Means Committee said it will make allies laugh if Congress passes a bill that urges the Office of the U.S. Trade Representative to work to convince other countries to remove Russia from their normal tariff schedule offered to World Trade Organization members, given that the U.S. is not doing that.

Rep. Kevin Brady, R-Texas, had agreed with the Democratic chairman of the committee on a bill that would have deprived Russia of permanent normal trade relations status, and the top Republican and Democrat in the Senate were on board as well. But H.R. 6968, the bill that was scheduled for a vote March 9, only imposes a ban on the import of Russian oil, liquefied natural gas and coal, and does not include the removal of PNTR, as was originally proposed.

"Why would the president leave 40% of all Russian sales into America untouched?" Brady asked during a press call on March 9. He said it's puzzling why Russian diamonds and Russian vodka should enter the U.S. tariff free, "but President Biden insisted, and so, in this bill, they remain protected."

"I think all of us were stunned," he added. "I don’t know what the discussions were, but the outcome is awfully discouraging."

Still, Brady said he would support the bill, as long as it was not rolled up in a vote for the spending bill. "The ban on Russian oil alone is worth our support," he said, but also said he would continue to urge his colleagues to support an end to normal trading status for Russia. "Clearly Congress pushed the president into the ban," he added.

Moving Russian goods into Column 2 would not necessarily hike tariffs sharply on the goods most commonly imported from Russia. In the case of an iconic good like caviar, the tariff would double from 15% to 30%. But fertilizers, one of Russia's top exports to the U.S., enter duty free under both most favored nation status and Column 2. The same is true for platinum, another top import. Fish, a top import, would vary. Cod would be tariff free in either column, but pollock is 3% for MFN and 25% in Column 2. Halibut and salmon are tariff free under MFN but have a 4.4 cents per kg tariff in Column 2.

When Canada removed MFN treatment for Russia, it imposed a 35% tariff across the board. Brady said Congress chose not to do that, and also chose to give the administration the ability to raise tariffs beyond what is in Column 2. "Fertilizer was one of those issues, or concerns, that drove us to include that flexibility," he said in response to a question from International Trade Today. "Many of the tariff rates on Russian products even pre-[PNTR] status were awfully low."

The language around PNTR also gave the administration the ability to restore PNTR "if Russia ended their aggression and withdrew from Ukraine," Brady said. He said it was not specific whether a withdrawal from Crimea needed to be part of that action. Russia annexed Crimea in 2014.