Proposed border tax would hurt these retailers the most
Proposed reforms to the nation's tax code would hurt smaller retailers more than larger ones.
The National Retail Federation said smaller retailers and their employees would suffer more than large companies under a proposal to create a border adjustment tax that would drive up the price of imported merchandise.
“Small retailers are probably the business group that is hardest hit by the potential impact of the BAT,” NRF senior VP for government relations David French said. “They do not have the economies of scale to be able to reduce the higher costs of their merchandise with the BAT imposed and are most likely to lose sales to lower-priced competition. We hope to work with you toward an alternative to the BAT and protect small retailers and the almost 17 million jobs that they contribute to the U.S. economy.”
French’s comments came in a letter to the House and Ways and Means Committee, which was holding a hearing on how tax reform would benefit small businesses, grow the economy and create jobs.
French said the 20% BAT that would be created under the “Better Way” tax reform plan proposed by House Speaker Paul Ryan, R-Wis., and Ways and Means Committee Chairman Kevin Brady, R-Texas, would effectively move the United States toward a consumption tax structure rather than the current income tax structure.
“Our small retail members are very concerned about tax reform efforts that might shift the burden of taxation to consumption,” he said. “Increased costs to the consumer will cause sales to decline and result in a contraction in their businesses. Instead, Congress should reject the BAT proposal and focus on reform of the existing income tax system."
A recent NRF survey of small retailers found that three out of five expect a negative impact on their businesses if the BAT is enacted, and 18% said their businesses could fail. More than 200,000 jobs could be lost to layoffs and wages could be reduced by close to $500 million because of reduced hours for employees. Small businesses make up 98% of the retail industry and provide 40 percent of its jobs.
The BAT provision would end importers’ ability to deduct the cost of merchandise purchased from other countries, resulting in higher prices for consumers. NRF estimates this could cost the average family as much as $1,700 annually.
Product Central: Neat-Feet
Once a year, the industry packs its bags and heads to Las Vegas for the annual hardware event that tops all the rest in its scope, diversity, and sheer magnitude.
The National Hardware Show attracts a dense and diverse crowd from all over the country, which is only surpassed by the assortment of products littered across a show floor vast enough to move the needle on one’s Fitbit. It’s certainly not possible to see everything the National Hardware Show has to offer, but that’s why the show organizers are offering tailored recommendations to attendees. For an added level of optimization, here are a few highlights from HBSDealer that might be worthy of your attention.
Here is a product featured in a recent issue of HBSDealer:
Neat-Feet is the quick and easy way for your customers to clean their shoes, boots or cleats and “leave the dirt outside.” Neat-Feet makes a natural Made-in-USA addition to an impulse display featuring doormats, outdoor footwear, or in farm & ranch.
(neat-feet.com) Booth: 10166
Check out other products featured in the March 2017 issue of HBSDealer.