A new report released by the president and CEO of the Advanced Medical Technology Association says the medical device excise tax scheduled to take effect Jan. 1, 2013, would add another 29 percent per year in taxes to the amount the medical device industry already pays in federal income tax, according to a news release.
According to the paper, prepared by Ernst & Young and titled Effect of the Medical Device Excise Tax on the Federal Tax Liability of the Medical Device Industry (pdf), the tax would see medical technology companies pay an additional $2.5 billion on top of the $8.7 billion in overall federal income taxes next year.
"A dramatic tax increase on a job-creating industry like medical technology makes no sense," said Stephen J. Ubl, president and CEO of AdvaMed, in the release. "A tax bill this big will only lead to fewer jobs, reduced investment in tomorrow's treatments and cures, or higher healthcare costs for the consumer. At a time when there is bipartisan agreement that the U.S. tax system needs to be more competitive, the device tax takes us in exactly the wrong direction. The device tax no longer has anything to do with the debate over the Affordable Care Act; the issue now is whether our tax system is going to support or undermine America's ability to compete in the global economy."
The House has already voted to repeal the tax.
Related Articles on AdvaMed:
AdvaMed Suggests Changes to FDA UDI Rule
AdvaMed Study: MedTech Prices Remain Low
AdvaMed Names John Graham New Vice President