by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Business owners touted the benefits of tax reform, saying that it would spur investment, create jobs, and grow the American economy. But some criticized the proposed border-adjustment tax included in the Republican tax reform blueprint.
The House Republicans introduced their tax reform blueprint,”A Better Way,” last year. The plan proposes a border-adjustment tax of 20 percent on all goods imported in the United States.
At a House Ways and Means hearing [Tuesday], business leaders told lawmakers that they support an overhaul of the tax code, but they do not support the border-adjustment tax.
Brian Cornell, the board chairman and CEO of Target, said the high tax rate of 35 percent on their business has motivated them to support tax reform that brings the rate down. However, the border-adjustment tax would increase that rate to 75 percent, since the tax would raise the prices of everyday goods the company sells.
“We’ve concluded that the new border-adjustment tax would undermine the pro-growth principles in the blueprint,” said Cornell. “More than 500 companies and associations feel the same way.”