Jan 26, 2017

These companies will be hit hardest by GOP tax reform

President Trump speaks at GOP retreat in Philadelphia. (Pablo Martinez Monsivais/AP)

The Republican Party's planned border-adjusted tax is an elegant solution for supporting domestic exporting industries, but paying for it will require a huge tax hike on companies that import their wares.

Cowen Research published a report Thursday that estimates the effect of the reform plan, and other planned measures, like eliminating the deductibility of interest and a headline corporate tax cut, on different industries and companies. Here are some of the big-name firms Cowen says will be hurt by reform:

  1. Apple: The world's largest company would see its tax bill jump because it won't be able to deduct the expense of assembly abroad.
  2. Constellation Brands: The largest beer importer in America will not be able to expense the cost of goods it brings across the border, like its Corona brand.
  3. Gap: Between 50% and 80% of the retailer's cost of the goods its sells comes from abroad.
  4. Walmart: Walmart's low margins means that it may not be able to survive a tax hike on imported goods without raising prices.
  5. Target: Will suffer from the same conundrum as Walmart, but will be worse off since less of its revenue comes from domestically-sourced groceries.
  6. J.C. Penney: The department store has high debt loads, and interest on debt will not be deductible under the Republican plan.

Why it matters: These are just a few of the many companies whose earnings will come under assault by the GOP plan. Don't expect them to sit idly by.

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Debate night: Candidates' last face-off before Super Tuesday

Sanders, Biden, Klobuchar and Steyer in South Carolina on Feb. 25. Photo: Jim Watson/AFP via Getty Images

Sen. Bernie Sanders wanted to keep his momentum after winning contests in New Hampshire and Nevada, while former Vice President Joe Biden hoped to keep his own campaign alive. The other five candidates were just trying to hang on.

What's happening: Seven contenders for the Democratic presidential nomination were in Charleston, South Carolina, for the tenth debate, just days before the South Carolina primary and a week before Super Tuesday. They spoke, sometimes over each other, about health care, Russian interference in the election, foreign policy the economy, gun control, marijuana, education, and race.

Go deeperArrowUpdated 2 hours ago - Politics & Policy

4 takeaways from the South Carolina debate

Former Vice President Joe Biden, right, makes a point during Tuesday's Democratic presidential debate, while Vermont Sen. Bernie Sanders listens. Photo: Win McNamee/Getty Images

The 10th Democratic debate was billed as the most consequential of the primary thus far, but Tuesday night's high-stakes affair was at times awkward and unfocused as moderators struggled to rein in candidates desperate to make one last splash before Saturday's primary in South Carolina and Super Tuesday.

The big picture: After cementing himself as the Democratic favorite with a sweeping win in Nevada, Sen. Bernie Sanders came under fire as the front-runner for the first time on the debate stage. Former New York Mayor Michael Bloomberg, who will be on the ballot for the first time next Tuesday, was a progressive foil once again, but he appeared more prepared after taking a drubbing at the Nevada debate.

Coronavirus spreads to Africa as U.S. soldier in South Korea tests positive

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens.

A 23-year-old American soldier stationed at Camp Carroll in South Korea has tested positive to the novel coronavirus, as the outbreak spreads to more countries.

The big picture: COVID-19 has killed more than 2,700 people and infected over 80,000 others, mostly in mainland China. Public health officials confirmed Tuesday the U.S. has 57 people with the novel coronavirus, mostly those repatriated from the Diamond Princess cruise ship.

Go deeperArrowUpdated 4 hours ago - Health