A group of major companies backing House Republicans' plan to adjust taxes at the border is launching its first television ads Sunday.
The American Made Coalition, comprised of Boeing, Caterpillar, Pfizer and other major importers, will begin "saturating" cable news channels in Washington, D.C., and in targeted states through early April with ads that back the Paul Ryan-led tax reform plan.
The ad does not specifically reference the border adjustment feature of the tax plan, which has provoked opposition from the retail industry and other importers. That same provision could benefit U.S. exports.
Instead, the 30-second spot urges the viewers to "support tax reform" and warns of more factories closing.
House Republicans have proposed taxing imports as part of a broader corporate rate-cutting reform that would tax goods based on where they are sold. As part of the plan, companies would no longer be allowed to deduct the cost of imported goods and services, but they would no longer pay any taxes on revenues from exports. In today's system, U.S. companies are taxed on all profits, whether they are earned in the U.S. or abroad. Republicans say that the change would encourage more manufacturing within the U.S., and discourage companies from moving production overseas.
Economists who favor the border adjustment say that it would cause the dollar to appreciate, boosting the purchasing power of importers. As a result, imports wouldn't be hurt.
Despite concerns that retail and other business opposition will divide Republicans and doom the tax reform push, House Republican leadership has said that the plan remains on track. Kevin Brady, the Texas Republican who chairs the Ways and Means Committee tasked with writing the tax reform bill, said this Friday in a Fox Business interview that he hopes to have the panel advance the legislation this spring.