BUILD Statement On Rep. Nunes’ Tax Reform Proposal

With Rep. Devin Nunes unveiling his business tax reform proposal today, the BUILD Coalition released the following statement:

“While the BUILD Coalition remains supportive of legislative efforts to reform the U.S. tax code in ways that encourage economic growth, Rep. Nunes’ plan falls short of achieving this most-important goal by eliminating the ability to deduct interest expenses,” said BUILD spokeswoman Sabrina Siddiqui. “Since the creation of the modern tax code in the early twentieth century, businesses have been taxed based on net income – revenues minus costs. Under Rep. Nunes’ plan, however, the U.S. would move toward a European style value-added tax (VAT) that taxes businesses based on cash flow and hides the costs to producers and consumers. Such a plan eliminates interest deductibility, a normal cost of doing business, in turn harming capital intensive industries, such as construction and manufacturing, as well as businesses of all sizes across the country. As Members of Congress and presidential candidates release and refine tax proposals, it is imperative that economic growth be the driving force behind reform efforts. Limiting interest deductibility in any way has been shown to run directly counter to this goal.”

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