By Richard Rubin
Koch Industries Inc., the conglomerate run by billionaire brothers active in Republican politics, says a key feature of House Republicans' tax plan could be "devastating" to American consumers and the economy.
The company is taking aim at what is known as border adjustment, which would add taxes to imports and remove them from exports as a way of encouraging production in the U.S.
In a statement released Wednesday, Philip Ellender, president of government and public affairs for Koch, said the proposal -- part of the House Republican tax blueprint backed by Speaker Paul Ryan -- would "distort the market" and raise prices. The company does support a comprehensive overhaul of the U.S. tax system.
"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," he said.
Koch is run by billionaires Charles and David Koch, who have funded a variety of think tanks and conservative interest groups.
The company operates refineries, manufactures paper towels and carpets and makes a wide variety of other products.
Koch's statement highlights just how difficult it will be for Republicans to achieve their goal of revamping the tax code in ways that would scramble the current system.
The House plan would lower the corporate tax rate and remove taxes on U.S. companies' foreign sales. But the border adjustment has drawn concern from retailers and limits on interest deductions are also causing corporate consternation.
Write to Richard Rubin at [email protected]