America’s farmers and ranchers don’t just feed and fuel our nation — they keep our economy strong, our exports competitive, and our national security intact. From cotton and wheat to corn, soy, tobacco, and beef, U.S. producers power America’s agricultural trade. But now, deep in the fine print of the massive tax and energy package on Capitol Hill, Washington insiders are quietly targeting a policy that helps some American farmers compete in the global marketplace.
As a former member of the House Agriculture Committee, including as the chair of its Operations Oversight subcommittee, I saw firsthand how Beltway bureaucrats and lobbyists can do serious harm to family farms and ranches, all under the rubric of doing something good. That’s why I’m speaking out now.
Buried in the ongoing negotiations over President Trump’s “Big, Beautiful Bill” — a sweeping package meant to restore his tax cuts, slash ESG mandates, and protect America’s producers — swamp lobbyists are working to eliminate a little known but vital trade tool known as the duty drawback. This longstanding policy ensures that American exporters aren’t saddled with tariffs when they import items that they produce into other exports — or, in some cases, when they export products similar to those they import.
In other words, if their import to export ratio is virtually a wash and if they are helping to keep U.S. producers competitive abroad, they don’t have to pay full tariffs. That’s not controversial. It’s commonsense policy that has been part of the U.S. trade playbook since 1789. And it can be a lifeline for U.S. producers competing in global markets, often in markets that are highly subsidized by foreign governments.
Ending this policy would amount to an export tax on American goods. That’s the last thing our farmers need after enduring years of inflation, rising input costs, and regulatory assaults under the last administration. And it should not be included in the Big, Beautiful Bill, which Trump made clear is designed to lower tax liabilities on Americans, not raise them.
Right now, the special interests’ target is the duty drawback on tobacco products. Granted, tobacco is an easy target, and I’m not particularly pro-tobacco. But don’t be fooled. This is the camel’s nose under the tent.
As Martha Boneta Fain put it, “today, they want to eliminate the duty drawback for American-grown tobacco. But tomorrow it’ll be wheat, corn, cotton, soy, steel — you name it. Give D.C. special interests an inch, and they’ll take a mile.” She’s right. We’ve already heard from some health experts that they want a war against sugar and high-fructose corn syrup.
Derek Day of Tobacco Associates, a nonprofit that represents tobacco exporters, has also rightly argued that “in many cases, tobacco is what holds the rest of [a farmer’s] operation together.” If exporting tobacco becomes harder for small growers (if not impossible), which the duty drawback repeal would cause, “it would also prove more difficult for them to grow and export anything else as well.”
President Trump’s Big, Beautiful Bill is supposed to reverse Biden’s damage by protecting the Trump tax cuts, ending ESG mandates, reining in the EPA, stopping the Department of Labor’s war on family-owned ag operations, and restoring American energy dominance. But how much of this will matter if swamp creatures sneak in language that sabotages small producers?
Eliminating the duty drawback would do just that. It would raise costs, kill export opportunities, and reward foreign competitors at the expense of American farmers.
Lawmakers from agricultural states must unite and sound the alarm. This betrayal of U.S. agriculture must be stopped cold.
This isn’t just about tobacco farmers. It’s about whether Congress will stand with American producers or hand another win to the swamp. That choice should be easy.
Gil Gutknecht is a former Republican member of Congress. He served as the House Agriculture Committee’s chair of operations oversight.
Image via Pixabay.