Your gas prices would likely skyrocket under Paul Ryan's tax overhaul

Gas prices will rise under GOP tax plan
(Image credit: Getty Images)

On Thursday, President Trump threw his conditional support behind a border adjustment tax, giving a boost to the centerpiece of a tax overhaul championed by House Speaker Paul Ryan. "It could lead to a lot more jobs in the United States," Trump told Reuters. White House Press Secretary Sean Spicer also spoke approvingly of the proposal, which would get rid of corporate taxes on exports and tax imports at a 20 percent rate, pitching it as a way to create jobs. The proposal has split Big Business, and several Republican senators are opposed, meaning it faces an uphill battle. "If Trump supports it, that makes it considerably more likely," Harvard Business School professor Mihir Desai told Reuters.

Like all big tax changes, this one creates winners and losers. But it's not clear exactly how much the losers would lose and the winners would win. As Andrew McGill explains at The Atlantic, a lot depends on how quickly the U.S. dollar strengthens in response, theoretically lessening the blow to consumers. "Economists differ on the particulars of the border adjustment tax," he writes. "Some people like it, and some don't. Every expert I spoke with agreed on one point, however: If Trump is looking to make new jobs, this isn't the way to do it."

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Peter Weber, The Week US

Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.