Border adjustment tax 101
In his interview with Axios Tuesday, Trump said that the "idea" of a border adjustment tax is "certainly something that is going to be discussed" in his administration. It's also Paul Ryan's top legislative priority. Cowen's Chris Krueger gave an analysis of what that could mean his morning note:
- If tax reform is passed, BAT will be included, but he doesn't see it happening until 4Q. If this happens, components of the tax could go into effect as early as January 1, 2018.
- Krueger sees a policy benefit of raising $1.1 trillion over 10 years.
- A low-dollar tax exemption and structuring the BAT as a withholding tax could make it more attractive to the retail sector.