Key facts
- A U.S. bill to sanction Russia includes provisions for 100% tariffs on goods from top buyers of Russian oil and natural gas.
- Democratic lawmakers expressed concern that the tariffs could grant President Donald Trump broad new trade powers, potentially affecting India, Japan, and EU countries.
- The legislation aims to cut revenues from Russia's energy sales used to fund its war in Ukraine.
- The bill allows for tariff exceptions for countries importing less than 15% of Russia's natural gas exports and taking steps to reduce those imports.
- Concerns were raised that the bill lacks a mechanism for congressional disapproval of tariffs and that the presidential authority never expires.
A proposed U.S. bill to impose sanctions on Russia has drawn criticism from Democratic lawmakers over its potential tariff provisions, which they fear could grant President Donald Trump extensive new trade powers.
The legislation, supported by President Trump and championed by the late Senator Lindsey Graham, aims to curb revenues from Russia's energy sales that fund its war in Ukraine. It allows for 100% tariffs on goods from the top five purchasers of Russian oil and natural gas.
While the tariff level was reduced from a previous 500% proposal to garner support, concerns persist in Congress regarding the expanded authority for the president. The top importers of Russian crude include China, India, Slovakia, Hungary, and Azerbaijan, while China, France, Japan, Hungary, and Belgium are the leading importers of Russian natural gas, according to Senate aides.
The bill includes exceptions for countries importing less than 15% of Russia's natural gas and taking significant steps to reduce those imports, which would exempt Japan, France, Hungary, and Belgium. However, any country exceeding this threshold without taking reduction measures could be exposed to tariffs.
Senator Ron Wyden and Representative Richard Neal voiced concerns that the tariffs could lead to increased prices for U.S. consumers. They stated in a joint statement that Congress should not delegate trade and tariff responsibilities to an executive perceived as prioritizing personal power over the welfare of Americans.
A document prepared by Democratic staff on the Finance Committee highlighted worries about vague scoping criteria that could allow President Trump to abuse these powers, noting the absence of a mechanism for congressional disapproval and the indefinite nature of the presidential authority.
Representative Gregory Meeks, while praising other sanctions in the bill targeting Russia's shadow fleet and energy infrastructure, expressed reservations about the tariff component, describing it as a "massive backdoor authority" that could harm American families by impacting trade with European allies.
Fernando Ferreira of Rapidan Energy Group suggested that Trump might use the threat of these tariffs as leverage in trade negotiations with countries like India. He also noted the bill's effectiveness in sanctioning entities involved in Russian sanctions evasion, integrating the EU's extensive list of sanctioned vessels into U.S. enforcement efforts.