Before we get started i want to take a moment to speak about the evil terror attack that occurred last night in the united kingdom, our deepest condolences go out to the victims, families and their loved ones. Know youre in our prayers. Today, were continuing our work on pro growth tax reform that will improve the lives of all americans. This mornings hearing is focused on strengthen americas competitiveness and preventing jobs from moving overseas. For years americans watched our our manufacturing plants, and longstanding u. S. Companies have moved overseas, devastating communities and the families that depend upon them. Hundreds of thousands of good paying american jobs have left, and continued to leave to china, mexico, ireland, and other foreign countries. Some of our communities have never recovered. Because when these plants and Companies Move overseas, local businesses housing value and local tax revenue disappear with them. Ive watched as 17 key Texas Companies have relocated their headquarters to england, canada, bermuda, ireland, the Cayman Islands, switzerland and the netherlands. Americans are being hurt because our nation is saddled with one of the most costly unfaira tax systems on the planet. According to the nonpartisan Tax Foundation, when it comes to competitive tax codes, america is ranked nearly last among our global competitors. 31 of 35. The good news is were edging out greece. The bad news is, nearly everyone else is eating our lunch along with our jobs, manufacturing plant and research facilities. The urgency for bold, permanent progrowth tax reform has never been greater. We gathered today because with our current tax field the Playing Field for American Workers is not level, not even close. Over three decades have passed since the last time we reformed americas tax code and while washington has been on the sidelines, our foreign competitors have been improving their tax systems for their businesses and their workers. Today its clear our tax code is failing American Workers, families and businesses in three crucial areas. First our Corporate Tax rate, now the highest in the industrial world at 35 , is at least ten to 15 points higher than our competitors. This makes it much harder for our businesses to complete globally and create jobs here at home. Second, our tax system discourages u. S. Businesses from bringing home foreign profits to grow middle class jobs and middle class paychecks. Instead, our tax code encourages global u. S. Businesses to keep profits abroad, to grow foreign jobs and paychecks. The last check more than 2. 5 trillion of u. S. Profits were stranded overseas unable to be affordably reinvested back here in america. Addressing these two issues is important, and would be good enough to move america back to average, somewhere in the middle of the pack. But tax reform only happens once in a generation. Is our vision merely to be average . Given all thats at stake for middleclass families, our goal in tax reform to be to vault america from ged dead last among our global competitors back into the lead pack, back among the top three best places on the planet for that next new job, manufacturing plant or research facility. Do this, we must take action on a third crucial competitive issue, ending the made in america tax. Today, the vast majority of our International Competitors apply taxes on products that are sold in their country no matter where the products made and they remove taxes from products that are exported, including products that are sold into the United States. This is called border adjustment. Taxes are adjust whend products cross the border. Over 160 of our competitors border adjust their taxes. These are all the blue countries on the map on the screens. Americas one of the very few who dont. Along with countries like cuba, north korea, and somalia. In our country, we apply taxes only on products that are made in america. Washington imposes that made in america tax on our products no matter where theyre sold, including overseas. As a result, made in america products are at a major tax disadvantage here at home and around the world. So why is washington providing special tax breaks for foreign products over americanmade products . Why should chinese steel get a tax break over American Steel . Mexican auto parts and agriculture over American Auto parts and agriculture, foreign oil over american oil. This doesnt make sense, especially since this is a big reason our current tax code drives u. S. Jobs and companies overseas. In the tax reform blueprint we propose to end the made in america tax and instead tax all products and services equally when they are sold in america, at a low rate of 20 . No special tax breaks for foreign products, everyone treated the same, true competition for the first time. And we lift the tax on made in america products and service whens they were sold abroad and for the first time leveling the Playing Field for American Workers, businesses, and farmers. Our goal is not simply to remove any tax that moves jobs over seas but to reestablish america as a 21st century magnet for new jobs and investment. And for the first Time Companies will no longer gain by moving their head quarts to bermuda, their manufacturing plants to china, or their intellectual property to ireland. As a result, for the first time in decades companies and industries are coming forward to describe how under the republican blueprint they can bring large part of their supply chains back to america. These are the goodpaying jobs, manufacturing plants, research labs, and Technology Centers that cutting that hows cutting edge intellectual property like patents. The current tax code told them to move these activities overseas. The house blueprint allows them to bring them back to the United States. We recognize this is a significant change from our current tax code. We know there are legitimate concerns, including from some of our witnesses here today and our colleagues on the other side of the aisle about how it will affect American Workers, businesses, and consumers. And we are committed to working with all of you to address these concerns. We have to get it right and we will. Its time for a tax code that rewards americans hard work rather than pushing american jobs out of our communities. The Tax Foundation estimates the house blueprint will create 1. 7 million jobs over the next decade and grow paychecks for middleclass American Families by roughly 5,000. Imagine how successful American Consumers will be when they have a secure, goodpaying job and a tax code that allows them to keep more of their paychecks. Its time for washington to get off the sidelines and back into the game. Fighting for our businesses, workers, and consumers. I want to thank all of our witnesses for being here today. We have a stellar field, and we look forward to hearing your ideas on how question level the Playing Field for American Workers and unleash a new era of american prosperity. Before i recognize the Ranking Member, i want to announce that we are joined here today by bill thomas who chaired this committee from 2001 through 2006. Mr. Chairman, welcome back. [ applause ] i now yield to distinguished Ranking Member mr. Neal for opening statement. Thank you. First let me thank you, mr. Chairman, for holding todays hearings on increasing u. S. Competitiveness and preventing american jobs from moving overseas. Its an important topic and i look forward to a productive conversation. As we continue with this series of hearings on comprehensive tax reform, i want to reiterate my support for reforming the tax code. Theres certainly strong bipartisan support for simplifying the tax system and making it more fair. We on the democrat side are willing partners this those efforts. However, we will support tax reform at a comprehensive basis that will ease financial burden on the middle class and working families. We will not support tax cuts for those at the top of the income scale at the expense of those of the middle class. Our primary focus and top priority in tax reform needs to be putting the middle class first. I also believe that a key component of tax reform is insuring that american businesses remain competitive in the Global Economy and that we prevent american jobs from moving overseas. Achieving thin concludes providing incentives to companies to conduct research and development here in the United States. We also need to prove our nations infrastructure so that its in line woerj developed nations. That includes meaningful investments to repair and enhance our nations roads, rails, bridges, harbor, sea and water harbor opportunities as well. These reforms can be done through the tax code and would also jump start Economic Growth and create thousands of jobs. Another key component of International Competitive science investment in well trained and Skilled Workforce opportunities. A 215 report indicated over the next decade 2 Million Manufacturing jobs in this country could go unfilled due to a skills gap. The new England Council recently estimated that thousands of advanced highpaying manufacturing jobs some with salaries over 80,000 a year with benefits go unfilled because employers are struggling to find candidates to meet the needs of these open positions. At a time when families across the country are trying to reach and stay in the middle class, our nation cannot afford to have factories and workers sit idle. To remain competitive, we need to invest in workforce development. Let me shift to another focus of todays hearing. The border adjustment tax. I think that the border adjustment tax proposal is certainly interesting. As my past support of an Innovation Box demonstrates, im no stranger to innovative tax ideas and willing to look outside the box for smart tax policy and certainly encourage others to do the same. Some argue that a border adjustment tax would create such an incentive for companies to make things in the u. S. That it would drive up demand for American Made goods. We certainly are supportive of american manufacturers. However, there are many unknowns about the border adjustment tax. Given the many significant economic uncertainties and risks associated with the border adjustment tax, the committee must evaluate its merits thoroughly and methodically. There are many very important questions that must be answered in order to evaluate the proposal. Psi plowed the chairman for holding todays hearings do just that. For example, what will the impact be on consumers. The retailers tell is that the cost of products like food, clothing and medicine will go up for consumers by more than 1,700 a year. Gas price cos increase by 35 cents a gallon. Also been told that a 20 bat bat would increase heating costs for a new england family by up to 400 per winter. Middle class families cant and shouldnt have to sustain these types of increases in Consumer Prices as a result of tax reform. Is that a risk with an adjustment border tax . Will the dollar strengthen to offset increases in Consumer Prices . If so how long will it take and will it be complete . How much influence success there with currency fluctuations and other increases of an increased dollar . In the border adjustment tax, is it wto compliant . Is there the risk of retaliation . What would the bats impact be on american jobs . Who would be the winners and losers of an adjustment to the boarder tax. Another question i have is the impact on Small Business. Unfortunately we dont have a Small Business witness with us today. But i think understanding the potential impact on Small Business is key. The owner of daves pet food city in ny direct who is quite successful tells me that his imported products would certainly provide the margin for him to operate the rest of his visit his business as currently constructed. He says that if his costs go up, he cant rent out utilities, he cant rent out other places to cut payroll, in fact he has to absorb the cost. He also is very concerned that if consumers have to pay more for gas and other essentials, he will keep less of the pet accessories that keep his business afloat. I hope we continue to exam the influence of the bat on Small Businesses. Mr. Chairman, i hope you will consider holding a hearing in the new future on how to best use revenue from a redeemed repatriation tax as we support tax reform. I support using repay the repatriation dollars to pay for it from other productive purposes from the middle class. Thanks for your leadership in calling for todays hearing and im hopeful we can dive into this topic of the bat and get our questions answered. I hope this will continue to be a productive conversation and thank the witnesses for their participation. Thank you, mr. Neal. Without objection other members Opening Statements will remain part of the record. Todays Witness Panel includes five experts, juan luciano is from the midland company. Brian cornell is the Board Chairman and chief executive officer of the target corporation. William simon is the former president and chief executive officer of walmart u. S. Lawrence b. Lindsy from the lindsy group and Kimberly Clausing is from the reed columns. The committees has received your written statements, theyll all be made part of the former hearing record. You each have five minutes to deliver your oral remarks. Well begin with mr. Luciano, welcome and you may begin when youre ready. Thank you. Chairman brady, Ranking Member neal, members of the committee. Thank you for the opportunity to testify about comprehensive tax reform. Adm began as a oil processor in minneapolis 115 years ago. Today we employ nearly 20,000 employees in the United States serving customers in 160 countries. Our network allows us to source craps, to transport them to our facilities, to transform them into food, feed, renewal fuels and chemicals and to deliver them to customers on six continents. We support the earth farmers and businesses in significant ways. In 2016, we purchased 25. 9 billion in goods and services from farmers or vendors in all 50 states. I am pleased to say we have employees in 25 of the 26 states represented on this committee. And congressman neal, we hope have to the opportunity to invest in massachusetts, too. Adms reach open Global Markets for americas farmers who have run a trade surplus for 50 years. But u. S. Companies like adm now compete with wellcapitalized, nonu. S. Companies who often enjoy tax system with lower rates and border adjustments that create a competitive advantage for them. Adm also thrives when americas farmers thrive. For us to serve americas farmer while creating jobs and contributing to growth, we must have a globally competitive u. S. Tax code. We must encourage the return of capital to the u. S. And enable Companies Like adm to create and maintain jobs here in the United States. The proposal were discussing today will help accomplish those goals. First, reducing the corporate rate to 20 will allow Companies Like adm to operate more competitively. Today, many competitors have a substantial tax advantage. Our effective tax rate is approximately 30 and we must compete with firms with tax rates at 20 or in the teens. Second, the proposal will level the Playing Field by moving from worldwide taxation to territorial taxation. The territorial tax system would remove the burdens of highCorporate Tax rates and address the capital restrictions that hinder u. S. Companies, but not global competitors. This the facilitate our ability to enable american crops to reach the world. Third, the destinationbased cash flow tax will level the Playing Field for our exports when we must go toe to toe with competitors who enjoy significant b. A. T. Rebates or exemptions when they export. Like b. A. T. , the u. S. Income tax system has no offset for exports. This systemically disadvantages our own producers. The destinationbased cash flow tax corrects this imbalance. The u. S. Market share of Global Exports has fallen precip tusly in major commodities over the past five decades. The u. S. Is no longer number one in soy beans and wheat. From 1965 to today, u. S. World share of soy beans exports has fallen from 90 to 39 with brazil taking the lead. Over the same period, our world share of exports of wheat has fallen from 40 to 20 with russia taking the lead. The u. S. World share of corn has fallen from 65 to 34 . Americas ante kuwaited tax system may not be the only reason for this decline, but it clearly contributed. We need to modernize our tax code to allow us to keep up with the rest of the world. This proposal creates the climate which will support reinvesting in america and will result in millions of american jobs. It will help stop the decline in our market share and enhance our ability to serve the world. Other countries have r