Trump's Possible 'Border Adjustment Tax,' Explained

Copyright 2017 NPR. To see more, visit STEVE INSKEEP, HOST: President Trump says he will announce his tax plan in a couple of weeks. He did not give details, saying only it will be, quote, "phenomenal." One thing the president has hinted he will include is something called the border adjustment tax. Robert Smith of NPR's Planet Money team explains what that is. ROBERT SMITH, BYLINE: The border adjustment tax is a way to lower the corporate tax rate. University of California professor Alan Auerbach has been talking about it for a decade, although he calls it the DBCFT. ALAN AUERBACH: It's a destination-based cash flow tax. But we just all call it... SMITH: That sounds terrible. (LAUGHTER) SMITH: That's terrible. AUERBACH: Yeah, we need some PR help. I realize that. SMITH: Recently, he got that PR help from an unlikely source, from President Trump. (SOUNDBITE OF ARCHIVED RECORDING) PRESIDENT DONALD TRUMP: Well, we're working on a tax reform bill that will reduce our trade deficits,