POLITICO Pro: Wyden proposes revoking Russia's favorable tariff treatment
Senate Finance Committee Chair Ron Wyden said on Tuesday that he favors repealing "permanent normal trade relations" with Russia to punish the country for its invasion of the Ukraine. That move would allow the United States to raise tariffs on Russian goods higher than the rates it charges on goods from other countries.
"We need to make sure tariff treatment of Russia reflects its pariah status," Wyden (D-Ore.) said in a statement on action he plans to pursue in the Finance Committee. "Permanent normal trade relations are extended to countries as they join the World Trade Organization and agree to abide by rules that ensure a level playing field in international trade."
Congress approved PNTR with Russia in 2012, just before Moscow formally joined the WTO. Repealing PNTR and raising tariffs on Russia would actually violate the U.S. commitment to accord all WTO members the same tariff treatment. But Wyden seemed unconcerned about that.
"Removing normal trade relations will raise tariffs on Russian goods and send a message that unprovoked invasions of a foreign nation will not be tolerated in any arena," Wyden said.
He also proposed creating new tools to retaliate against Russia's heavy-handed control of the internet.
"Russia's actions to throttle internet access and censor online content as a means to crush dissent and limit access to reliable information not only raise human and civil rights concerns, but also act as a barrier to trade," Wyden said. "We must consider how trade tools can be used to address such digital authoritarianism by any actor."
Two House Democrats — Reps. Earl Blumenauer (D-Ore.) and Lloyd Doggett (D-Texas) — also favor repealing PNTR and want the United States to initiate action aimed at kicking Russia out of the WTO.
In an op-ed published in the Wall Street Journal, former WTO Appellate Body judge James Bacchus outlined how that might be accomplished, even though there's no WTO provision for expelling a member.
"Expulsion would be possible under Article X of the WTO agreement, however, if two-thirds of the WTO’s current 164 members vote to alter the agreement. If Russia were to refuse to accept the changes, then a three-fourths vote could expel the Russian federation,” Bacchus wrote.
Wyden outlined a number of other actions the committee could take to punish Russia. Those include giving the IRS Criminal Investigations Unit more resources to go after illicit Russian assets. Congress should also close a loophole in the Investment Company Act that exempts private equity and hedge funds from implementing basic anti-money laundering requirements, he said.