Control of transcription speed, which influences many co-transcriptional processes, is poorly understood. We report that PNUTS-PP1 phosphatase is a negative regulator of RNA polymerase II (Pol II) elongation rate. The PNUTS W401A mutation, which disrupts PP1 binding, causes genome-wide acceleration of transcription associated with hyper-phosphorylation of the Spt5 elongation factor. Immediately downstream of poly(A) sites, Pol II decelerates from >2 kb/min to <1 kb/min, which correlates with Spt5 dephosphorylation. Pol II deceleration and Spt5 dephosphorylation require poly(A) site recognition and the PNUTS-PP1 complex, which is in turn necessary for transcription termination. These results lead to a model for termination, the "sitting duck torpedo" mechanism, where poly(A) site-dependent deceleration caused by PNUTS-PP1 and Spt5 dephosphorylation is required to convert Pol II into a viable target for the Xrn2 terminator exonuclease. Spt5 and its bacterial homolog NusG therefore have related functions controlling kinetic competition between RNA polymerases and the termination factors that pursue them.