Medical device tax and the iPhone: Grover Norquist’s anti-tax group jumps on new argument for repeal

MassDevice.com coverage of the medical device tax

Conservative tax-reform activist Grover Norquist is putting some of his organization’s muscle behind a mostly GOP-fueled effort to paint the medical device excise tax as a danger to smartphones and tablets.

In an op-ed for The Hill, Katie McAuliffe wrote that there is legitimate concern that smartphones, tablets and other hand-held devices could be unnecessarily taxed under the new 2.3% medical device excise tax because the FDA has not clearly stated whether or not mobile devices that run health apps could be interpreted as medical devices themselves.

"This is a legitimate question for clarifying tax authority, and a clear consequence of passing a monolithic bill without a thorough reading," McAuliffe wrote.

McAuliffe is the executive director for Digital Liberty, a sister organization of Norquist’s Americans for Tax Reform, which also shares the same address and telephone number as the conservative advocacy center,

Late last week, 6 GOP lawmakers from the House Committee on Energy and Commerce wrote a letter to FDA commissioner Margaret Hamburg to clarify the agency’s position on mobile apps and whether or not the technology would be considered medical devices subject to the new 2.3% excise tax. The agency has said in previous guidance on mobile health apps that mobile platforms such as smartphones and tablets would be considered medical devices based on whether or not the device was being marketed for medical use.

The lawmakers wrote that they were concerned about the "potential of ‘actual use’ becoming a factor in the future."

Further, they asked "Has the FDA discussed, prepared, or analyzed the effect of the medical device tax on smartphones (as well as tablets or similar devices) or the creators or distributors of applications for those products?"

In her piece for The Hill, McAuliffe wrote that the IRS decision to defer the taxation question onto the FDA was tantamount to turning the agency into a "a tax-collecting arm of the government rather than an agency focused on science and consumer welfare."

"Intellectually one would think that since the IRS says ‘The new tax also does not apply to the sale of any other devices that are of a type generally purchased by the general public at retail for individual use (the retail exemption)’ then apps would not be taxed. However, the FDA made it clear that they need to make a determination, so developers beware," she wrote.

The medical device tax has long been a target for Norquist, one of the most visible anti-tax activists in American politics. In March of last year, he framed the tax as a direct attack on senior citizens in an article for the Daily Caller.

"Who buys medical devices? Who buys pacemakers, wheelchairs and other costly medical devices? Seniors do," he wrote.

He was back at it in July, penning an op-ed for the Washington Times where he dubbed the landmark Affordable Care Act the "Obamatax," adding that "a vote for Mr. Obama is a vote for more than $5.5 trillion in higher taxes over the next 10 years."

"What medical devices?" Norquist asked. "Braces for your kids. A stent for your heart. A wheelchair. All the cool stuff you see in hospitals will now cost more in order to pay Mr. Obama’s tax on medical devices," he added.

RSS From Medical Design & Outsourcing

  • BRILAMET research project brought to successful conclusion: Precision laser-cutting technique optimized for thick metal sheets
    Using lasers to cut sheet metal is something that has typically been handled in the realm of CO₂ and fiber lasers, although this may not be the case for much longer. Diode lasers are increasingly emerging as the light source of choice for a large number of applications, as can be seen from the BRILAMET […]
  • Mobidiag and Unilabs enter into agreement over use of Amplidiag product line for molecular gastrointestinal diagnostics
    Mobidiag, a Finnish molecular diagnostics company specialized in the development of innovative diagnostics solutions for infectious diseases, and Unilabs, a diagnostics service provider, announced an agreement covering the supply of Amplidiag products over the next four years for Unilabs in Sweden and Norway. The Amplidiag product line covers six diagnostic products for various gastrointestinal infections, […]
  • Quick work keeps dental implants in place among women with osteoporosis
    As natural as aging is, it can tend to feel like a downward spiral. As the years increase, bone mass and strength decrease. Teeth can fall out, and the drugs and surgery designed to return things to normal may actually make bone related issues worse. Osteoporosis is a common problem for women who have gone […]
  • Cyberdyne CEO has severed spines on his agenda
    Editor’s Note: This article is from Bloomberg.com‘s Natasha Khan. Cyberdyne Inc.’s CEO, Yoshiyuki Sankai, is researching ways to repair damaged body tissue. The 57-year-old scientist’s vision: to treat patients with spinal injuries by using stem-cell related technology to repair nerve connections and robotic suits that aid movement. Sankai’s company is setting its sights on better […]
  • Teknor Apex to showcase wide range of PVC compounds for medical devices at Medtec China
    Building on its international leadership role as a supplier of medical-grade PVC compounds, Teknor Apex Company has developed flexible and rigid formulations that address the special needs of device manufacturers. The company will highlight these capabilities at Medtec China 2015. “Teknor Apex produces or markets medical-grade PVC compounds in China, Singapore, Europe, and the United […]
  • The Raspberry Pi eco-system goes interstellar with the new Raspberry Pi Sense HAT
    Newark element14 has globally launched the latest addition to the expanding ecosystem of Raspberry Pi accessories, the Raspberry Pi Sense HAT, as featured in the ‘Astro Pi’ space mission. The Sense HAT will enable enthusiasts to control the same hardware used in space. The Sense HAT attaches to the Raspberry Pi board, and can be […]
  • CommScope completes acquisition of TE Connectivity’s Telecom
    CommScope Holding Company, has completed its previously announced acquisition of TE Connectivity’s Telecom, Enterprise and Wireless businesses, a leader in fiber optic connectivity for wireline and wireless networks. The all-cash transaction, valued at approximately $3 billion, strengthens CommScope’s position as a leading communications infrastructure provider with deeper resources to meet the world’s growing demand for network […]
  • SPI awards IKO Prosthetic Creative System the Student Design International Design Excellence Award
    SPI: The Plastics Industry Trade Association congratulated IKO Prosthetic Creative System for winning the SPI Student Design Award, part of the Industrial Designers Society of America’s (IDSA’s) International Design Excellence Awards (IDEA) program. The award was presented to IKO, an innovative, youth-focused prosthetic design company led by Chicago-based designer Carlos Torres, by SPI’s Senior Director of […]
  • New assay could revolutionize diagnosis and treatment of life-threatening disease
    Invasive Fungal Disease (IFD) is an emerging global health problem associated with high mortality rates in severely immunocompromised patients, such as those undergoing intensive chemotherapy or stem cell transplantation, and in patients suffering immune compromising conditions such as AIDS. The most common causative agents of this disease have been identified as Candida and Aspergillus species, […]
  • Molex delivers ISO 13485-compliant, medical-grade surgical cables from its class 100,000 clean room facility
    Molex, LLC operates a fully ISO 146441-1:1999 Class 8-certified clean room, satisfying strict particulate contamination levels specified by ISO-compliant requirements. Located in Thailand, the facility has less than 100,000 particulates (≥0.5µm) per cubic foot of air and manufactures a variety of ISO 13485-compliant medical cables and surgical cables used in operating theatres, hospitals, laboratories and […]
  • Swept-Source OCT: Patent license agreement between Massachusetts General Hospital and Heidelberg Engineering
    Heidelberg Engineering has entered into a patent license agreement with Massachusetts General Hospital (MGH) in Boston. The agreement grants global and exclusive rights to 77 basic patents and patent applications which relate to swept-source OCT technology and its application in ophthalmology. Spectral domain OCT has become indispensable to eye care professionals worldwide to diagnose and […]

Leave a Reply