US President Donald Trump wants a 20 per cent border tax on all imports from Mexico to pay for the proposed border wall.
White House spokesman Sean Spicer on Thursday informed that Trump wanted to use the new tax to fund the proposing wall between the US and Mexico.
Spicer said this hours after Mexican President Enrique Pena Nieto cancelled the work meeting with President Trump scheduled for next Tuesday in Washington. Spicer didn't release any detail about how the new tax will work.
This is one of the way to pay for the wall that the US is planning to construct along the US-Mexico border. However the proposal is currently only for Mexico, Spicer said.
"When you look at the plan that's taking shape now, using comprehensive tax reform as a means to tax imports from countries that we have a trade deficit from, like Mexico. If you tax that USD 50 billion at 20 per cent of imports, which is by the way a practice that 160 other countries do -– right now, our country's policy is to tax exports and let imports flow freely in, which is ridiculous. By doing it that way we can do USD 10 billion a year and easily pay for the wall just through that mechanism alone," Spicer said.
"Right now we are focused on Mexico, but I think as we look comprehensively at our trade situation and countries that we have a deficit for, this is something the president has been talking about holistically," he added.
Building a wall at the US southern border with Mexico to be paid by Mexico was one of Trump's key election campaign pledges.
On Wednesday, Trump had signed an executive order to start work on ‘a large physical barrier’ between the two countries to check illegal immigration.
After signing the order, Trump had reiterated that the project will start as soon as possible and financed by Washington, but Mexico will ‘100 per cent’ reimburse the US at ‘a later date’, which has been rejected by Mexican government several times.
