Thu, Mar 09, 2017 - Page 10 News List

US lawmakers, executives to meet over border taxes

DOG EAT DOG:The border-adjusted tax proposal has pitted retailers against exporters, as it would punish companies that rely on low-cost international suppliers

Bloomberg

Retail executives were yesterday to return to Washington in their latest bid to fight a border-adjusted tax (BAT) proposal, aiming to turn more US Republican lawmakers against US House Speaker Paul Ryan’s plan.

Four industry executives were scheduled to meet with Republicans in the House and US Senate, including Senate Majority Whip John Cornyn and Senator Cory Gardner.

Business leaders from IKEA Group, Dollar General Corp, Petco Animal Supplies Inc and Michaels Stores Inc are to discuss the tax proposal, which they argue will raise prices for consumers.

“Comprehensive tax reform benefits retailers and consumers alike, but including a harmful border-adjustable tax is no way to achieve it,” said Christin Fernandez, a spokeswoman for the Retail Industry Leaders Association, which represents the companies.

The border-adjusted tax has pitted industry giants against one another, with retailers on one side and exporters on the other. The proposed overhaul would punish companies that rely on low-cost overseas suppliers to stock their shelves, part of a bid to foster more domestic manufacturing.

The issue has also divided lawmakers, with Ryan and House Committee on Ways and Means Chairman Kevin Brady struggling to gain support from other Republicans.

Yesterday’s meeting was to be part of an almost daily conversation between the retail industry and members of US Congress and the administration of US President Donald Trump, Fernandez said.

A group of retail CEOs that included Target Corp and J.C. Penney Co last month met with Trump to discuss tax reform and specifically the border-adjustment tax.

Some Republicans lawmakers, including Senate Committee on Finance Chairman Orrin Hatch, have said they are considering alternatives to the tax proposal.

The Americans for Affordable Products Coalition, a group opposed to the tax, has grown to include 200 companies and trade groups.

The National Retail Federation, the industry’s largest trade group, last week launched a parody-style TV ad urging consumers to oppose the tax. It aired on Fox & Friends and Saturday Night Live, shows Trump has been known to watch.

The Ryan-backed proposal would put a levy on US businesses’ domestic sales and imported goods, while exempting exports from their taxable income. The tax would be assessed at a 20 percent rate and would replace the current 35 percent corporate income tax.

“Our focus is on educating lawmakers and the public on the negative consequences of BAT, which is our top priority,” Fernandez said. “This is a bad proposal that will hurt American consumers.”

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