Tax reform is hard
Here’s Richard Rubin of the Wall Street Journal reporting on how Republicans are learning that reforming the tax code is difficult: A linchpin of the House Republicans’ tax plan, an approach called “border adjustment,” has split Republicans and fractured the business world into competing coalitions before a bill has even been drafted. A border-adjusted tax would impose a levy on imports, including components used in manufacturing, and exempt exports altogether. Opposing it are retailers, car dealers, toy manufacturers, Koch Industries Inc., oil refiners and others that say it would drive up import costs and force them to raise prices. Ways & Means Chairman Kevin Brady is quoted: “Yes, I know tax reform is difficult. That’s why it only occurs once a generation.” And if you’re tax nerd who also enjoys some politics, I recommend reading Showdown at Gucci Gulch to give you an idea of what Brady is talking about. Back in the ’80s, politicians just wanted lower rates and fewer deductions, which seems much easier than what Brady and Speaker Paul Ryan are trying to do. Brady and Ryan want to fundamentally change the tax system so, naturally, they’re running into resistance. Rubin does a good job of covering all the moving parts and it’s good reading (especially if your clients end up asking you about it). Companies that import a lot of goods or raw materials would get hit hard by border adjustment, giving companies that make products here a big advantage. That oversimplifies the problem, but you get the idea — it’s complicated! Read Article: http://goingconcern.com/accounting-news-roundup-tax-reform-hard-good-bad-accountants-02-08-17/ Comments are closed.
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September 2017
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