Will Border Adjustment Tax follow path of health care reform?
The way forward for the Border Adjustment Tax (BAT) is unclear. AIADA organized a Dealer Fly-in to Washington last month to show the extent of opposition to the proposed tax. NADA and WANADA also oppose the BAT, which would eliminate taxes on exports and impose a 20 percent tax on imported goods and domestic sales. A study by the Center for Automotive Research found that a 20 percent tax could add $2,000 on average to the price of new vehicles.
House Speaker Paul Ryan supports the tax and says it is needed to help American companies compete abroad and to raise revenue to lower the corporate tax rate. President Trump has not taken a public stand on the tax.
The BAT bill is in the House Ways and Means Committee. But Chairman Kevin Brady (R-TX) told a group of reporters recently that the tax will likely see significant modifications, such as a phase-in period, according to the Detroit News. If the BAT is part of a contentious tax reform plan which would need bipartisan support to pass it may be doomed.
General Motors is working on a backup plan that would let the company move production, technology and capital if the BAT becomes law, reported TheDetroitBureau.com. The company currently plans to export the 2018 Buick Regal from Germany.Download Bulletin PDF