Some of the biggest names in manufacturing got to spend over an hour putting their case for a border-adjustment tax to Donald Trump yesterday, possibly swinging the pendulum in their favor as an increasingly bitter dispute with retail CEOs grinds on.
After emerging from yesterday’s meeting with around two dozen CEOs, Trump told Reuters the border tax proposal had positive elements, though he didn’t specifically endorse the plan. His comments were the most supportive yet, given that he has previously described it as complicated.
Companies that sell many goods overseas, such as Boeing and GE, have embraced the plan advanced by House Republicans to tax imports by 20% while making profits on exports tax deductible amid a broader corporate tax cut.
“It could lead to a lot more jobs in the United States,” the president said.
During the portion of the meeting open to the media, Trump lamented an apparent hemorrhaging of jobs overseas and pledged to bring millions back to the U.S. Exporters argue that more favorable tax treatment would strengthen their profits, giving them scope to employ and train more local people.
After the meeting manufacturing CEOs made upbeat comments, though none of them talked specifically about the border tax either. On his Twitter feed, GE CEO Jeff Immelt said: “Tax reform a high priority for job creation. Business community will come together to help find a workable solution.”
Dow Chemical CEO Andrew Liveris, who is leading the manufacturing council, said he was “very encouraged” by Trump’s pro-business stance, while Merck CEO Ken Frazier said it was “very clear the president is interested in lessening the tax burden.”
All three men were among 16 CEO signatories of a letter sent Tuesday to House Speaker Paul Ryan backing the border adjustment tax. They are all part of the Made in America Coalition, which also includes Boeing and Pfizer.
On the other side of the debate, a band of more than 100 retail CEOs calling themselves the Americans for Affordable Products coalition fear a 20% import tax would push up the cost of common household items—and wipe out their profits.
CEOs associated with the group, including Wal-Mart Stores’ Doug McMillon, will be hoping the pendulum swings back in their direction soon.
“This is the next zig of a zig-zag pattern,” David French, head of government relations for the National Retail Federation said. “This is the beginning of a long process.”