The chief executive officers of two major American companies—retailer Target (TGT) and agribusiness Archer Daniels Midland—will offer countering views in a hearing before U.S. lawmakers on Tuesday on a proposed border adjustment tax.
Target CEO Brian Cornell has been one of the most vocal opponents of the Republican-backed border adjustment tax and will testify alongside Juan Luciana, president and CEO of ADM (ADM), which joined a coalition supporting the tax.
The border tax proposal, which imposes a tax on imports while providing a credit for exports, has been proposed by House Republicans as part of a larger tax code overhaul.
House Speaker Paul Ryan argues the proposed border tax, which is estimated to garner $1 trillion, will not affect prices and will allow rate cuts for businesses while not creating deficits, but retailers warn that it could raise consumer prices as much as 15%.
The outlook for passage of the border tax—which drew staunch opposition from retailers—remains perilous, especially as key Senate Republicans and President Donald Trump have refused to endorse it.
Dimming the prospects more, lawmakers and lobbyists have begun to speculate that Congress will be unable to rally support for a sweeping tax code overhaul this year, and are beginning to look instead at cutting tax rates without broad reform.
The House hearing on Tuesday, which was organized by supporters, will seek to make a more vocal case for the tax. Cornell is expected to be the only critic on the panel, according to those who have organized against the tax.
The remaining three witnesses, including William Simon, the former CEO of Wal-Mart Stores (WMT), are expected to testify in favor of the tax. Simon, despite his past with a large retailer that opposes the tax, has stated publicly that he supports it.
Target officials have held more than 200 meetings with congressional staffers and lawmakers, and Cornell has met with 30 lawmakers to try to persuade them to abandon the tax proposal, Target spokeswoman Dustee Jenkins said.
