Tax-writing chair: Changes set for border tax plan
- Author: Salvatore Jensen Apr 08, 2017,
Apr 08, 2017, 14:42
The Washington Post reported yesterday that both a carbon tax and a value-added tax (VAT) were being explored, citing a White House official.
This indicates that the tax bill is still in the early stages of development, as Trump fights to keep his promise of individual and corporate tax cuts without harming the economy.
The latest developments came as officials from two major United States coal companies have reportedly been in discussions with the White House with a view to persuading the Trump Administration to keep the U.S. within the Paris Agreement on climate change.
Opposition to BAT from the Kochs and import-dependent industries suggests a rocky road ahead for Trump's stated priority of tax reform. Could be health care, could be something else.
BAT, billed as a way to boost USA manufacturing, would exempt export revenues from federal tax, while ending the deductibility of import costs by corporations, making imports for production or resale costlier. Some conservatives panned the idea for raising the cost of consumer goods such as automobiles, electronics, and clothing, while others contend it will fulfill Trump's pledge to boost American manufacturing. "Because public-private can be very expensive", Trump said. Thus, many Republicans weren't prepared to accept the bill in its present form.
Trump said he wanted to accelerate that roll-out, but provided no timeline.
Under border adjustment, American companies would pay tax on the sale of imported products, but not on products sold overseas.
"Let's go for a more traditional approach at this point and see if we can build consensus around that", Portman said.
President Trump and his team are in the first stages of developing a plan to overhaul the tax code in the US.
"I'm thinking about accelerating it". Because households with less money have to spend a greater fraction of their incomes on staples, they would pay relatively more under a tax on consumption such as a value-added tax.
"Rather than keep Washington taxes high and have just a few get relief from state and local taxes we're proposing to lower taxes for everybody at every income level so they can use those dollars for what's important to them, which may include state and local taxes".
The chance of Congress passing a carbon tax might not be much better, especially since any tax on emissions that cause global warming would draw opposition from the fossil-fuel industry.
Meanwhile sources close to the President's White House chief of staff Reince Priebus were briefing how his arch-rival, strategy chief Bannon had been dispatched to Capitol Hill to put the squeeze on Republican rebels by telling them: "This is not a debate". Independent estimates have said it would raise more than $1 trillion in tax revenue over 10 years.