The Club for Growth is launching an ad campaign opposing the $1 trillion border adjustment tax, Axios reports.
The border tax would apply to imports coming into the United States, but would exclude exports from being taxed. The tax would allow an across-the-board corporate tax cut, while also generating as much as $1 trillion over 10 years, according to CNBC.
The ad criticizes Rep. Kristi Noem, R-S.D., because of her support of the border tax. Noem is a member of the House Ways and Means Committee, which has jurisdiction over tax and trade policy.
"All of our competitors have this kind of a tax. When we stay back in the ancient plan and the way we run our tax system today, it makes our companies, it makes America uncompetitive," Noem told Fox News.
The ad, which will appear in Noem's state of South Dakota on TV and digital, says household goods will cost more as a result of the tax.
Club for Growth president David McIntosh said he expects the ad campaign will be expanded to other members of the Ways and Means Committee in other states, Axios reported.
House Speaker Paul Ryan said the border adjustment tax is vital to tax reform, but politicians and corporations have been sparring over it.
President Donald Trump has met with retailers who are against the tax and initially called the plan too "complicated," CNBC reported.
On Tuesday, chief executive officers of 16 companies expressed their support for the border tax in a letter to congressional leaders.
"Nearly every other country in the world" already has such a tax, the letter read.
Industrial giants such as Boeing and General Electric also favor the tax, but retailers oppose it, citing it would increase the costs on imports that they resell in the U.S., according to CNBC.
Critics believe the tax has little chance of passing.
"I wouldn't call it dead, but I would say it's on life support," Horizon Investment global strategist Greg Valliere told CNBC.
Senate Majority Whip John Cornyn of Texas said the votes to approve the tax may not be there.
"Given the imperative of 51 senators and 218 House members and one president, I think we need to look for other options," he said.
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