Trump's 'job traitor' tax plan faces Republican block
- Published
Congressional Republicans are warning President-elect Donald Trump that his call to tax American companies that move overseas may not become law.
Republican House Majority Leader Kevin McCarthy on Monday refused to endorse Mr Trump's plan to place 35% tariffs on relocated companies.
His comments come in response to Mr Trump tweets over the weekend.
"There will be a tax on our soon to be strong border of 35% for these companies," Mr Trump wrote.
"This tax will make leaving financially difficult…Please be forewarned prior to making a very expensive mistake! THE UNITED STATES IS OPEN FOR BUSINESS!", he wrote in a series of social media posts.
Mr Trump's call to tax imports on goods made by firms that relocate would need to pass through Congress, where Republican orthodoxy includes devotion to free-market principles.
Mr Trump should instead keep companies in the US by changing the tax code and lowering the rate that businesses must pay, Mr McCarthy said.
"I think that's a better way of solving the problem than getting into a trade war with a 35% tariff," the California Republican told reporters at the US Capitol building.
Republicans like Congressman Kevin McCarthy have so far been reluctant to criticise their president-elect
Republicans are typically reluctant to impose such tariffs, seeing it as an intrusion into the free market, but few have so far challenged outright Mr Trump's plan.
Reception within the party to his 35% tax has ranged from lukewarm to outright hostility.
House Speaker Paul Ryan refused to comment directly on it, while the conservative-leaning US Chamber of Commerce criticised it as "self-destructive".
And the Club for Growth political action committee's president said such tariffs "would be devastating to consumers and businesses''.
In other developments:
Mr Trump has urged Boeing to cancel its order of a new Air Force One jet due to "out of control" costs
a Republican elector in Texas has vowed to withdraw his backing of Trump when the electoral college meets next week
Vice-President Joe Biden has suggested he would be open to running for president for a third time, in 2020
Trump wants to dump new Air Force One
Boeing, Trump and his chaos theory
What does Trump want with Al Gore?
Can Donald Trump get what he wants?
Recently, Trump was applauded by Republicans leaders when he got involved in negotiations with air-conditioning manufacturer Carrier, preventing hundreds of jobs from moving to Mexico.
But taxpayers were left with a $7 million bill, after Mr Trump promised tax breaks and grants to the US company which still plans to shift around 1,000 jobs out of the country.
Mr Trump has been preparing for office by putting together his new administration, but differences remain over his choice of Secretary of State.
He will be inaugurated as the 45th president on 20 January.