GOP's Kevin Brady to Trump: Don't blow tax cut gains with China trade war

  • House Ways and Means Committee Chairman Kevin says Trump is right to go after China for intellectual property theft.
  • "The challenge for every president is how to do it in a way that doesn't punish Americans for China's misbehavior," he adds.

GOP Rep. Kevin Brady on Thursday urged President Donald Trump to be cautious about his new proposed tariffs on China.

The House Ways and Means Committee chairman said Trump, who is expected to unveil his plan Thursday, is right to go after China for intellectual property theft, saying the actions by China cost "thousands of U.S. jobs."

"The challenge for every president is how to do it in a way that doesn't punish Americans for China's misbehavior," the Texas Republican told CNBC's "Squawk Box." "So, you've really got to narrow these and target these. It is a very discerning line to do that."

On Wednesday, top U.S. trade official, Ambassador Robert Lighthizer said Trump would target China's high-technology sector and could also include restrictions on Chinese investments in the United States. He said the policy goal is to structure the tariffs to inflict maximum harm upon China and try to limit the effect on U.S. consumers.

The administration's actions are just the latest crackdown on China. Earlier this month, the White House announced tariffs on steel and aluminum imports, sparking fears of a possible trade war and sending the stock market into a tailspin. The tariffs could hurt Chinese imports of the metals.

China's Global Times, the ruling Communist Party's official newspaper, suggested in an editorial this week that China take against U.S.-subsidized soybean exports.

Brady, whose state is a major soybean growing region, said his committee is urging the president to "narrow" his proposal on China, "and make sure there isn't spillover that affects our workers, our families, our farmers."

Tariffs are taxes, he added. "Lower is better. Zero is best."

Following Trump's announcement, Brady would like Trump to hold a "30-day comment period" before the tariffs are initiated. "You lay it out, you get the feedback, you continue to fine tune it," he said. "Again, every president has had this challenge with China."

Brady, who helped put through the tax law passed in December, is talking to the White House about a possible "phase two" of the Republican tax plan. He said in April the House will push a bill that restructures the IRS.

"We think a new and improved tax code requires a new and improved IRS," Brady said Thursday.

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