Senate’s No. 2 Republican: Border tax ‘probably dead’

Sen. John Cornyn (R-Texas) appeared to close the door on Thursday to a border adjustment tax at the heart of the House GOP’s tax reform plan. 

 

“My guess is based on the reception here in the Senate, with many people skeptical of how it would work, the border adjustment tax is probably dead,” Cornyn, the No. 2 Senate Republican, told Texas reporters during a conference call. 

House Republicans have been working on a tax bill based on a plan they released last year that includes a controversial provision known as a “border adjustment” tax that would impose penalties on imports and exempt exports.

But a set of tax reform guidelines released by the Trump White House on Wednesday did not endorse the so-called BAT tax.

{mosads}Treasury Secretary Steve Mnunchin said at a Hill event on Wednesday that the House provision didn’t “work in its current form” but they would continue to talk with lawmakers about possible revisions. 

Congressional Republicans have struggled to get on the same page on a border adjustment tax with several GOP senators voicing strong skepticism about the proposal. 

Cornyn signaled that lawmakers are prepared to drop the BAT tax as they try to get a deal on tax reform. 

“Now that I’ve had a chance to talk to [Ways and Means Committee] Chairman Brady in the House and majority leader in the Senate the goal is going to be unify the House and the Senate and White House behind a single tax plan which does not include the border tax,” he said during the conference call. 

But Rep. Kevin Brady (R-Texas) said earlier Thursday that he plans to make refinements to the House Republicans’ border-adjustment proposal and continue to defend it.

Cornyn made similar comments to reporters in the Capitol earlier Thursday. Asked if the border adjustment tax was “dead,” he said: “I believe so.” 

“I’m glad we’re talking about what’s possible and not things that are going to be a distraction,” he said. 

McConnell, Brady, Mnuchin, House Speaker Paul Ryan (R-Wis.), Sen. Orrin Hatch (R-Utah) and Gary Cohn, Trump’s chief economic adviser, huddled on tax reform earlier this week before Trump released his proposal.