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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsAnalysis: Why the Border Adjustment Tax Is Dead and an Overhaul Could Be Too
Proponents have failed to address critics concerns; lack of alternatives make overhaul difficult
Posted Jun 6, 2017 5:03 AM
Lindsey McPherson
@Lindsey McPherson
House Republican leaders controversial border adjustment tax is dead, and as a result, their plans to dramatically overhaul the tax code could soon be too.
The border adjustment tax, or BAT, is a proposal to tax imports instead of exports, reversing the way the United States currently taxes goods crossing its borders. House GOP leaders, namely Speaker Paul D. Ryan and Ways and Means Chairman Kevin Brady, have pushed for the tax as a way to discourage U.S. companies from moving operations overseas and to raise roughly $1 trillion in revenue to partially offset an ambitious corporate tax rate cut.
But without the BAT, Republicans may not have a way to pay for that proposed rate cut from 35 percent currently to 20 percent under the House GOP plan or as low as 15 percent under President Donald Trumps blueprint. And if they dont fully offset their tax cuts within the 10-year budget window, the cuts cannot be considered permanent under the reconciliation rules they plan to use to advance their tax bill.
As a consequence, Republicans would be left with temporary tax cuts, and would likely curb fewer deductions and credits than they would have under a full, permanent overhaul. Ending the labyrinth of existing tax breaks and permanently lowering tax rates is critical to a true tax overhaul, the likes of which Ryan and GOP tax writers have been dreaming of for years. Anything less would represent a failure of their promise to simplify the tax code.
Needless to say, a lot was riding on the now-dead border adjustment tax.
Opposition to the BAT has been slowly boiling since January, when Republicans, in control of both Congress and the White House for the first time in a decade, began talk of enacting the first major rewrite of the tax code since 1986. The BAT proposal was floated last June in the House GOPs A Better Way blueprint, but opposition was relatively muted until Donald Trump in a surprise to many even within his own party won last falls presidential election.
- See more at: http://www.rollcall.com/news/politics/analysis-border-adjustment-tax-dead-overhaul
Gothmog
(145,335 posts)Wounded Bear
(58,670 posts)what they want to do are all pretty much bad things for the country.
I'm not mad about that.