[CTC] IUST: Trump pledges to CEOS that offshoring will result in border tax

[Dolan, Mike]

Trump pledges to CEOS that offshoring will result in border tax
January 23, 2017


Days after taking office, President Donald Trump told CEOs in a Jan. 23 meeting that businesses that move production operations outside of the United States and then ship products back into the U.S. will face a border tax. He also slammed foreign countries for erecting barriers to U.S. exports and not engaging in "free trade."

"When you decide, if you decide to close it," Trump told business leaders assembled in the White House Monday morning, "if that happens we are going to be imposing a very major border tax on the product when it comes in. Which I think is fair. Which is fair."



Trump was not specific as to how a tax on imports would be implemented, or if it would only apply to goods produced by companies that moved U.S.-based operations overseas versus all imported products. House Ways & Means Committee Chairman Kevin Brady (R-TX) and House Speaker Paul Ryan (R-WI) have backed a border-adjustable tax that would essentially increase taxes on imports while providing breaks for exports, regardless of offshoring. Trump last week called that plan "too complicated," but softened his opposition to it shortly thereafter.



"So a company that wants to fire all of its people in the United States and build some factory some place else and then thinks that that product is just going to flow across the border into the United States, that's not going to happen." Trump told 12 business leaders at the White House. "They're gonna have a tax to pay, a border tax. Substantial border tax."



Some have argued that both Trump's and the House GOP's plans could inspire trade retaliation -- possibly through a loss in a World Trade Organization dispute -- or more generally slow the movement of goods and services across borders. Further, the broad contours of the House GOP plan will almost assuredly face opposition<https://insidetrade.com/node/157246> from industry sectors that rely on imports, and may also run into trouble in the Senate.



But Trump took on those arguments on Monday, charging that the barriers other countries erect to stymie U.S. exports justify a response by the United States.

"Now, some people would say that's not free trade. But we don't have free trade now, because we're the only one that makes it easy to come into the country," Trump said. "If you look at China, if you look at many other countries, I don't have to name them, but many other countries, they can't believe what we do."



"So we take in things free and yet if you take a plant, or you want to do something, you want to sell something into China and other countries it's very very hard. And in some cases it's impossible. They won't even take your product," he continued. "But when they do take your product they charge a lot of tax. So I don't call that free trade. What we want is fair trade, fair trade. And we're going to treat countries fairly, but they have to treat us fairly."



Attending the meeting were the CEO of Dell Technologies, Michael Dell; CEO of Whirlpool Jeff Fettig; president and CEO of Ford Motor Company Mark Fields; CEO of Johnson & Johnson Alex Gorsky; president and CEO of Lokheed Martin Marillyn Hewson; CEO of Arconic Klaus Kleinfeld; CEO of Dow Chemical Andrew Liveris; President and CEO of U.S. Steel Mario Longhi; CEO of SpaceX Elon Musk; CEO of Under Armour Kevin Plank; CEO of International Paper Mark Sutton; and CEO of Corning Wendell Weeks. -- Jack Caporal (jcaporal at iwpnews.com<mailto:jcaporal at iwpnews.com>)




Michael F. Dolan, J.D.
Legislative Representative
International Brotherhood of Teamsters
Desk  202.624.6891
Fax    202.624.8973
Cell    202.437.2254

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