Trump mulls 20% border tax on Mexico; aides later call it just an option

Show Caption Hide Caption White House floats import tax on Mexico to fund wall Press secretary Sean Spicer seemed to suggest a 20 percent border tax could help raise funds for President's Trump's border wall project.

WASHINGTON — President Trump's plan for a wall along the Mexican border could be financed through a 20% border tax on all imports from the United States' third largest trading partner, the White House said Thursday.

“It clearly provides the funding and does so in a way that the American taxpayer is wholly respected," White House press secretary Sean Spicer said. “We are probably the only major country that doesn’t treat imports this way.”

But shortly after he announced the proposal in an unscheduled "gaggle" with reporters on Air Force One, Spicer clarified to a separate group of reporters in the West Wing that it was just one proposal. "There are clearly a bunch of ways it can be done," he said. "The point is American taxpayers are not going to fund it."

White House Chief of Staff Reince Priebus added that it was part of a "buffet of options."

The unexpected proposal and subsequent backtracking underscored just how quickly the Trump White House is churning out policy proposals in a hectic first week in office, with a crowded calendar of meetings, speeches and executive actions.

The border tax plan would need congressional approval, and Spicer described it as the beginning of a process that would be part of overall tax reform. The tax proposal would have the benefit of dovetailing two of his signature policies: Curtailing illegal immigration and enacting more protectionist trade regulations.

But the proposal could face resistance even among Republicans.

"Border security yes, tariffs no," Sen. Lindsay Graham, R-S.C., wrote on Twitter. "Simply put, any policy proposal which drives up costs of Corona, tequila, or margaritas is a big-time bad idea. Mucho Sad."

Spicer: Trump seeks 20% tax on Mexican imports Sean Spicer said President Donald Trump will seek a 20 percent tax on Mexican imports to pay for a proposed border wall. (Jan. 26)

The U.S. trade deficit with Mexico is was $49.2 billion in 2015, according to the U.S. Trade Representative. Though Spicer didn't explain how the tax would work, the principle is similar to a border adjustment tax currently being discussed in Congress, which would heavily tax imports but give a tax credit on exports.

“Right now our country’s policy is to tax exports and let imports flow freely in, which is ridiculous," Spicer said.

Spicer ran through the math by applying 20% to the difference, coming up with nearly $10 billion a year.

The United States could "easily pay for the wall just through that mechanism alone. That’s really going to provide the funding,” he said.

Actual imports from Mexico totaled $316.4 billion in 2015.

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