In June, House Republicans unveiled our “Better Way” Blueprint for tax reform that will improve the lives of all Americans and help our country win around the world.
This bold Blueprint delivers a 21st century tax code built for growth—the growth of families’ paychecks, the growth of American businesses, and the growth of our nation’s economy.
One of the most pro-growth pieces of our plan is called “border adjustability,” a policy that will strengthen America’s global competitiveness and help us succeed around the world. For the first time in our nation’s history, we are going to end the tax on American exports and make it more affordable for our manufacturers to sell their products to customers in other countries.
Here’s how border adjustability works. Under our current broken tax code, U.S. companies pay a tax when exporting products, but not when they import products. To avoid paying that tax on exports, U.S. companies move jobs, research, and headquarters overseas. That way, the products they sell abroad are not subject to U.S. tax and the products they import back to the U.S. are not subject to U.S. tax.
Under our Blueprint, “Made in America” products will no longer be taxed and imports will not be subsidized—setting our manufacturers up for success around the world. Here’s how that helps workers, families, and job creators:
- It levels the playing field. Today’s policies put “Made in America” products at a disadvantage, compromising the ability of our manufacturers to compete and succeed in the global economy. Under the current code, our businesses are subject to a U.S. tax when they sell their products in foreign markets—a tax not imposed on a foreign competitor selling in the same markets. Our Blueprint levels the playing field, ensuring that competition is based on quality, price, and service—not outdated tax regimes.
- It eliminates tax incentives for companies to move jobs overseas. Tax policies play a big role in a business’s decision to set up their headquarters overseas. Our Blueprint eliminates the tax incentive to relocate outside of the United States, encouraging businesses to stay in America and create new jobs at home, as well as encouraging foreign companies to locate here. For years, there have been attempts to build walls of tax rules as a way to keep companies in the United States. But through border adjustability, our Blueprint eliminates the tax reasons for companies to leave, which is a much more effective solution to encouraging job creation and economic growth here at home.
- It establishes the U.S. as a 21st century magnet for new business investment. By replacing our current outdated tax system, our Blueprint encourages U.S. businesses to invest in our local communities, not in other countries. Through border adjustability, our Blueprint eliminates the current tax disincentives for locating a global company in the United States. And global companies that locate in the United States provide opportunities for the smaller local businesses that are part of their supply chain, further increasing the creation of jobs and the rise in wages.
- It simplifies the international tax code. The current code is uncompetitive and imposes many restrictions and burdens on U.S. businesses. Our Blueprint streamlines existing rules and eliminates outdated and unnecessary tax barriers so our businesses can sell American around the world. And because border adjustability ensures a level playing field, that streamlining is possible without the need for new complex rules that try to force companies to stay.
It’s time to finally end the tax on “Made in America” products, restore American competitiveness, and grow our economy.
CLICK HERE to learn more about “Built for Growth” tax reform.