Koch Industries, a powerful company run by the influential Koch brothers who have significant political influence, warned Wednesday that the tax plan put together by Republicans in the House might have "devastating" effects on the economy.
According to The Wall Street Journal, the Wichita, Kan.-based company thinks adding taxes on imports and removing them from exports is a bad decision.
"While companies like Koch who manufacture and produce many products domestically would greatly benefit in the short term, the long-term consequences to the economy and the American consumer could be devastating," said Philip Ellender, Koch's president of government and public affairs.
The taxes in question are called a border adjustment, and their intention is to help offset losses from lowering the corporate tax rate from 35 percent to 20 percent.
The Journal reports that currency exchange rates could make the taxes less effective, while industries such as retail may have to raise costs at the consumer level to make up for paying higher taxes on imports sold in stores.
Charles and David Koch have been active in Republican politics for several years and have donated millions of dollars to candidates and causes.
Republican lawmakers are itching to get to work with President-elect Donald Trump, now that the GOP controls both houses of Congress and the White House. Economic analyst and Trump adviser Stephen Moore recently told Reuters he thinks a border adjustment tax might be a good thing for the U.S. economy.
"If we have a border adjustable tax system, that can solve a lot of these trade issues that Trump is talking about," Moore said.
"You're going to tax what's imported and not going to tax what's exported. So we're going to reduce the trade deficit and we're going to have more companies come in here."
Republicans posted details of their plan, called "A Better Way," at abetterway.speaker.gov.
© 2023 Newsmax. All rights reserved.