Florist tells House panel that border tax would be a 'deal killer'

Florist tells House panel that border tax would be a 'deal killer'
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A representative for the Society of American Florists told the House Small Business Committee on Wednesday that the proposed border-adjustment tax would be "a real deal killer" in his industry.

"I ask that any border adjustment in tax reform exempt floral agricultural products to avoid significant harm to the more than 10,000 small flower shops across the country," said Rutland "Skip" Paal, Jr., whose flower business has locations in Maryland and New Jersey.

He added that Congress might also consider an exemption to the border tax for small businesses that could help other industries.

The border-adjustment proposal, which is part of the House Republicans' tax-reform blueprint, would subject imports to U.S. taxes while exempting exports. House Republican leaders argue that the proposal is important because it would level the playing field for American-made products. But a number of GOP senators and retailers have expressed concerns that it would result in consumers paying higher prices on products.

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Paal said that the vast majority of flowers he sells are imported and that if prices rise, people would likely just buy other products instead, such as fruit baskets or candy.

"Flowers are not a necessity like food or housing — if our products are taxed at a higher rate, those costs will translate to higher prices and consumers will shift their spending to other products where flowers have traditionally been appropriate," he said.

Paal's testimony comes on the same day that tax executives at retail companies met with senators to lobby against the border-adjustment proposal. Retail representatives at the meetings included executives from 7-Eleven, Best Buy and Wal-Mart, according to the Retail Industry Leaders Association.

Paal and other small-business leaders at Wednesday's hearing discussed other priorities for tax reform as well.

Anne Chambers, who testified on behalf of Women Impacting Public Policy, praised the House GOP blueprint's provisions that would lower rates for small businesses, and repeal the estate tax and the alternative minimum tax.

"This meaningful reduction in taxes would give us additional capital to grow our businesses and create jobs," she said.

David Borris, who testified on behalf of the Main Street Alliance, said that large businesses need to pay their fair share of taxes.

There should be a way to get big corporations to repatriate their foreign earnings in a "fair way" at a rate that isn't too low, he added.