Tax could have been damaging to Canadian economy
Top leaders in the U.S. have scrapped a border tax proposal that could have done significant damage to Canada’s economy.
The Trump Administration and Republican leaders in the U.S. Congress have both said the border tax – which could have caused business investment to leave Canada and head to the United States, – is no longer part of their tax code re-write plan.
As noted by the Associated Press, “They say in a joint statement they’re “confident” a border tax system is no longer needed to reduce rates. The Republican majority in the House had been pushing the border tax to prevent a ballooning budget deficit.”
In a sign of a clear consensus rejecting the tax, the statement on scrapping it included“Treasury Secretary Steve Mnuchin, White House economics aide Gary Cohn, House Speaker Paul Ryan, Senate Majority Leader Mitch McConnell, Senate Finance Committee Chairman Orrin Hatch and House Ways and Means Committee Chairman Kevin Brady.”
The border tax could have been damaging to Canada, as it would have encouraged companies to shift production into the United States, which could have cost jobs here in Canada and pulled investment out of our country. However, many businesses in the U.S. had opposed the tax.
For an idea of how the border adjustment tax could have worked, check out the video below:
Photo – YouTube