Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
Break airline is Mary Kate Hopkins. Imus sobbed and zoos AS senior policy analyst. For Americans. With prosperity you may have heard determine facts. Dropped around from mod time to time over the past a hundred days. Or rise so on a sobbed as good afternoon I appreciate you being Manassas afternoon. What is a back to explain our border adjustment taxis. Soaring and thank you for having me. Aborted just attack is part of the larger tax reform proposal that's on the table from how with the Ways and Means Committee. And it essentially would put a 20% tax. And everything that US businesses import it into the United States. And that would appeared to be. Gay and out girls flower Oman president trumps. Called CY attacks. Products and or may be elsewhere and brought here to us sell land nine in that some cases. Those are tariff free at this point. I mean yes it's that that's a lot of the same line this one is a little bit broader anything usually when you're trying to talk about it he's talking about it kind of one off. What a particular country trying to that is across the board just simply get taxes. And others would be attacks dead today is paid by our corporations rights. It limits fall under the corporate taxes local type collected but generally the ways and these taxes work out that there is ultimately passed on to the consumer. Yeah I badges that was my good dead that was my next question yes exactly where was going where Dell what does that's. This means to be a consumer is there's a bats enacted. And dime buying us all let's say key stat out was made in that same doll if there's a bat what is agony do that the price of that. Yeah I mean they're afraid they're gonna go I'm just so and a lot of people don't realize. He had it easy to think about the tax applying to gain an entire so that's made in Mexico but it would also apply raw materials and any component parts. Like the US auto industry relies on imported parts to build cars. Even if they're made in America quote unquote nice they're still relying on those imported parts went to a drive up the cost of everything essentially the Americans by. Sol if I'm buying a Ford F 250. Bond that is made America. But it is made in America have some components. That were. That come from Mexico golf. Instead of 45000. Dollars I am I paid 48000. Or 50000 finance track. Definitely I mean depending on how much of that how much of the parts are imported. We think we've seen studies that played. Car prices going up by an average of 2000 dollars. When I read. The last few days have been no reading a lot about the bats. And every everything I've read about it seems to indicate dead it read block IE's. On a stronger. US dollar in fact one. Analysis I read said dead it would rely on a dollar that would be 21. Saint. Stronger and that is. Boy that's that's quite a number to achieve. Maybe a number one is that true number two if it is why is that true. I'm actually it was need to go up I 25%. Wow. Think Hillary just crazy I know so the whole border adjustment but the theory you realize again and had an idea that. In the dollar will increase in value Q offset the increase in taxes that these companies will face. So ultimately supporters of the of the provision are saying. Consumers don't actually feel the pain because they're dollar will be worth more cash and so they can cover the cost of the tax would that increase value. Now economists across the board are skeptical that this would happen you know I think we've known that there would be some increase in value of the dollar but it would be nowhere near the amount needed to offset the cost of this attack. Yeah I I could absolutely see where the dollar would get stronger. Because this sci aid. Affect our Bob that would seem to be. The generation of more jobs in the United States that would make the American dollar stronger but wow 25% boy that's an awfully high barrier to achieve. Yes it is and so and he had that they increase and and who value the dollar is actually based on. Yeah international exchange market than in the demand for the dollar so it's it's it's. Completely unpredictable essentially and that's to make the bet that Americans are gonna feel the pain of attack. It just their attitude I've arrests in our opinion. What is the the arguments for those. Who are behind you is it your job creation is is that the main argument that that would create more jobs in the United States. Lives pupil at first they needed and it and they say they needed and found a way to pay for tax reform. We would encourage. Members of congress to look at. Spending cuts rather than a new tax to pay for tax. Lot of people more BS announced ports and you have a Republican congress that doesn't look too likely. Hank. And yet and there are other argument is that there is this quote unquote made an American tax currently. Where import Perrier and getting the benefit of coming in cheaper than the US made good. That problem without argument is that the main American tax. Only good in that our tax code is overly complicated and our tax rates are among the highest in the world. And so implementing this new tax on imports don't do anything that says to help that the problem is our race. Which can come down without a border just tax. Then how worried now BA if I'm birdie if I'm correct via corporate tax rate. In now the United States is 35%. And that's the national raid the federal rate alone. So for example in Pennsylvania. It's 35%. Plus. The states. CMI which is nine point 9%. So they'd be paying a total of 44 point 9%. Far I'm correct so far I knocked. Yeah I think the average across the states is about 39% for the marginal rate. Okay thirty Amber's have been a marginal rate. One clam beds. Is is floating around. Would call for dropping bats to 20%. And then it exempting. Exports. And taxing imports is a Wall Street Journal our reports and are some house Republicans who have while lodged on tobacco. Number one is that accurate number two what what stone likely outcome of that. Great yet so vis Katherine import. It is the border doesn't accept the components right on yeah and that's become part of one big plants the F so they've they've proposed dropping every since labor that would have been great that would stimulate the kind of growth that we're looking for any economy. They would exempt exports which is. In the way that both countries in the world taxpayer companies they don't tax outside of their borders. That's not a bad that's not a bad idea it's just this tax on imports that that we're taking issue with because that's what's going to be felt by the American consumer. They like what raided a talking about. For a for a bad days it's 10% he had when he presented is in 20% that's yemen's what is good but I retiree. Eventually her the way it works they would not let. The corporations deduct the cost of importing get it. Currently they can do that so it it would eventually work out to be a 20% tax. Tall walls teach our rice there's some Moeller intentions are reasonable the strategy is questionable. Start with the political blunder Republican tax funds normally receive overwhelming support from the business community but at bats. Has created deep divisions I would imagine that. Corporations companies that do import business. Our. Dramatically opposed to it while those who do a lot of exporting our forest. Yes centric. Yes that's one of the major issues that this. With the tradition I mean tax reforms especially corporate tax reform should be something that all companies to the United States are ready and willing to get behind her when you have a provision that the divisive event that really puts the rest of the package at risk. And right now we even have a package Phnom tax reform has been. Put off Sean Spicer and Steve minutia and above said that well may be in August. But others who well look at the administration say that says probably not gonna happen this year at all and may not happen on sale line next year. And for an overall. Tax reform that also includes. What what you when I pay. That has also been bandied about its side it looks unlikely to happen this year at all. If I have given up hope yet I know as and it didn't hit. It is difficult but no I think that there is still a reasonable expectation that we can get it done this year. I think. We are seeing signs that. Both sides are willing to come to the table this summer how discussion. So I'm so hopeful. And even if something happened early next year they could still make it retroactive to apply it to 2017 evil taxes. Yeah I SM and I am a congressman here last week. And we're discussing because I think this idea of tackling healthcare. Right out of the box was a big big mistake I never would have done that first I would have done enough. I infrastructure re against an easy political victory because you know you got some Democrats who are knocking it turned down. Money for rob bridges in and highways and things in their district in many got some room to negotiate but down the way it was described to me. Health care. Is driving the bus and that the attacks provision any tax reform. Is reliant on health care and then some money can be put aside from the tax reform package. To what do infrastructures so it's like 123. And if you don't get them and add order your probably meg gonna get them on all. Yeah I may think that's that's the line of thinking that we've seen from quite a few people here. I don't none of that necessarily true they're not that they're not totally reliant on each other. I wouldn't it seems to be the theme of this week at least at that health care would be to comfort. And you're talking about it again I can move to. It's this tiny greens doesn't make any sense what Floyd Dell Americans for prosperity like to see. In any tax reform package. Yeah we are. Fully part of this country and that can't confirm we've been calling for years now I'm congress can address the code we really just are looking for. A simpler scared code with lower res. Glad to give a wave credits loopholes very special interest. I'm really a code that works for the average American and when you look at the rest of the proposal better on the table there's some really good run they can help get this thing that I kind of got a. Well he ran for rob president in 1996 and I voted form in the Republican primary Steve Forbes is the primary reason I voted for. Had done called for a flat tax. Knoll or very few deductions. At that point it was everybody who made 36000 dollars a year or less. Page no taxes and our corporate tax rate I believe at that time he was calling for 9%. Or rise nine point 5% that is sobbed this morning but. It was off for herbs and now Larry Kudlow into our guys run this scathing editorial in the New York Times on now. Why be Republicans are maybe trying to make tax reform so hard it's. What I didn't see that beautiful. Film. Yeah what is the future of a back tax I saw the job I did that's that kinda redundant Indians bats. Or be a tax because the I saw him as NBC in February pronounced dead at that point. You seem to think it still alive. You know I think if it's what I wouldn't declared sullied and I think it's on its way out we have seen it increasing opposition especially in the senate. The more that senators who learn about the unintended consequences that reporters have been tax there's less they are inclined to support it. I mean I think it's that eventually does the Fed and at that point so now we're just focusing on trying to figure that out forget. Well what about presidential amber really haven't heard him talk about it I am off he favors inner opposes it. White House hasn't taken an official position on at ten they appear to still be calling in ever but the fact that they haven't come out in support of their and the provision has been in the new term for months now I think that's a good time. Anybody who zealous thing wants to learn more about dye your organization Americans for prosperity we're gonna find them online. It that you go to AFP got ordered. TS PE dot Ford okay Mary Kate Hopkins senior policy analyst for Americans for prosperity. Tiger now bounty back attacks in the last fifteen minutes or so I appreciate you being let us thank you very much. Kept thinking of.