The House aims to take action on tax reform this spring and plans to include a controversial border tax on imports, according to a top House lawmaker.
Rep. Kevin Brady, R-Texas, said on Fox Business Sunday that the Ways and Means Committee, which he chairs, plans to move on tax reform in the spring. He said that the goal is to go bold and significantly lower the U.S. corporate tax rate to compete with other countries.
“We’ve got some work to do,” he said. “I think we have momentum on the policy.”
The pivot to tax reform comes a few days after the House pulled a major bill to gut Obamacare due to insufficient support from conservatives and moderates. Republicans were hoping to get $1 trillion in savings from gutting Obamacare.
Brady said that while tax reform could be difficult, Republicans should prepare to go bold since tax reform happens so infrequently.
“We decided since this was just once-in-a-generation we can’t go mediocre, we can’t shoot for the middle of the pack,” Brady said, referring to improving the U.S. corporate tax rate compared to other countries.
He said that currently, America is nearly dead last in tax rates and he wants to “leapfrog America” to go near the top. The U.S. has the third-highest corporate tax rate in the world at nearly 40 percent.
Brady also hinted that a border adjustment tax would likely be part of the reform package in an effort to raise revenue.
A border adjustment tax is a tax on imported goods and a tax break for exported goods. However, major retailers such as Wal-Mart oppose it because they say it will lead to higher prices.
Brady said that it is “a given anyway” that a border adjustment tax will be included, and not just because it generates revenue to pay for the tax cuts.
“We want to make sure there is a level playing field between foreign products and made-in-America products here as well as abroad,” he said. “It eliminates any tax incentive to move any jobs or headquarters overseas.”
But so far the White House hasn’t explicitly endorsed a border adjustment tax. Brady wasn’t worried of any rift with the White House over border adjustment.
“We have so much in common with the Trump administration,” he said.
