[5] Auerbach worked with Michael Devereux, who had introduced with Stephen R. Bond, the term destination-based corporate tax.
[citation needed] In theory, a border-adjustment tax is trade neutral: the stronger domestic currency would make exports more expensive internationally, lowering demand for exported products while reducing the costs incurred by domestic firms in purchasing goods and services in foreign markets, helping importers.
Thus, the anticipated strengthening of the domestic currency effectively neutralizes the border-adjustment tax, resulting in a trade-neutral outcome.
[6] In the United States, the Republican Party in 2016 included most of Auerbach's recommendations in their policy paper "A Better Way — Our Vision for a Confident America",[7] which promoted a move to "a destination-basis tax system.
"[8]: 27 [9] As of February 2017, the proposal was the subject of heated debate - with Gary Cohn, Director of the National Economic Council opposing it[10] and the Koch brothers-funded Americans for Prosperity (AFP) lobby group, unveiling their plan to fight the tax.