admittedly, i’m in a learning mode here, and going on my interpretation of the article’s definition of “border adjustment tax”— which in itself sounds orwellian; however, my interpretation is that a (1) tariff on a foreign made product is paid by the foreign exporter in American dollars to the American gov’t, vs. (2) the border adjustment tax—which is a tax paid on a foreign produced product by a combo of American seller and consumer (really the American consumer as all such taxes are traditionally passed on to the consumer).
is that right? if so, that’s a vast difference, imo.
This basically doesn't exist - tariffs are paid by the importer of record. It has to be this way because the US has no jurisdiction to tax foreign companies that are exporting to the US. The first moment that a tax can be applied is when a product arrives in the US, and at that point, it is whoever is receiving that has to pay.
The difference between a classic tariff and the border adjustment tax is that a tariff is paid by the importer when the product arrives in the country, and the border adjustment means the importer can't deduct the cost of buying the imported product from their taxes.
So under a straight tariff, if I import a $1 apple from china, I might pay a 30% tariff when it arrives in country : $.30 check to the govt. Under border adjustment, I import the $1 apple then sell it for $2. At the end of the year when I file taxes, I have to report a $2 profit because I can't deduct the $1 as the cost. At a 20% corporate tax rate, I'd pay $.40 to the govt. But if I bought an American apple for $1.25 and sold it for $2, I'd be able to deduct the cost, and only have to pay tax on $.75 of profit and would pay $.15 to the government.
I'm not advocating for a border adjustment tax, but I think it is an interesting idea that's worth looking at. It really does the same thing as a tariff, just applied in a different way,