Senator David Perdue of Georgia is officially urging his colleagues to oppose a key component of the House Republican's corporate tax reform package, called border adjustment, which would raise taxes on imports and eliminate income taxes on exported products.

As the former CEO of Dollar General, Perdue is inclined to understand retailers' antipathy for the proposal, as it would greatly increase the tax bill of those who import products for resale in America. Georgia is also home to one of America's largest retailers, Home Depot. But Purdue has concerns beyond the reform's impact on his former industry. He argues:

  • Border adjustment would raise prices on consumers;
  • Higher prices would mean lower demand and fewer jobs;
  • and if the dollar appreciated in response to the new tax, it "would trigger a multi-trillion dollar reduction in the value of foreign investments held by U.S. investors including many pension funds and retirees."

Our thought bubble: Don't expect the last point to be a political winner, as the share of Americans with assets denominated in foreign currencies is far smaller than Trump's base, who wants to see the tax code written to protect domestic employment. But the first two will be strong arguments in the public relations battle over tax reform.

Senate math: With a slim Republican majority in the Senate, border adjustment proponents need every vote they can get, but opponents have the option of targeting several persuadable Republican Senators.

Go deeper

Markets swell as the economy shrinks

Illustration: Eniola Odetunde/Axios

The economy is sputtering, but the markets are thriving — a highly unusual event that shows how the coronavirus has thrown all bets off.

Why it matters: The disconnect adds to the wealth gap. The richest 10% of households — who own 84% of stocks — are getting richer, while millions of out-of-work Americans cross their fingers that pandemic unemployment benefits will be extended.

Updated 9 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 10 p.m. ET: 10,836,500 — Total deaths: 520,605 — Total recoveries — 5,723,808Map.
  2. U.S.: Total confirmed cases as of 10 p.m. ET: 2,735,554 — Total deaths: 128,684 — Total recoveries: 781,970 — Total tested: 33,462,181Map.
  3. Public health: The states where face coverings are mandatory Regeneron stops trial after drug fails to help patientsWhat we know about the coronavirus immune response — Fauci says it has been a "very disturbing week" for the spread of the coronavirus in the U.S.
  4. Business: Top business leaders urge the White House to develop mandatory mask guidelines.
  5. Politics: Herman Cain hospitalized for COVID-19 after attending Trump Tulsa rally — Biden downplays jobs number, rebukes Trump for ignoring health crisis.
  6. Economy: The economy may recover just quickly enough to kill political interest in more stimulus.
  7. States: Texas mandates face masks in public spaces Florida reports more than 10,000 new coronavirus cases, and its most-infected county issues curfew.
10 hours ago - Health

Fauci: Coronavirus surges mark a "very disturbing week" in the U.S.

Fauci testifies to the Senate Health, Education, Labor and Pensions Committee on June 30. Photo: Al Drago/AFP via Getty Images

NIAID director Anthony Fauci told medical journal JAMA on Thursday that it has been a "very disturbing week" for the spread of the novel coronavirus in the U.S.

What's happening: The number of coronavirus cases increased in the vast majority of states over the last week, and decreased in only two states plus the District of Columbia, Axios' Caitlin Owens reports.