The 2.3% medical device excise tax takes another step closer to reality with the release of guidance documents by the IRS.
UPDATED at 2:59 p.m., with comment from Rep. Erik Paulsen (R-Minn.)
The U.S. Department of the Treasury today released proposed regulations on who and what will and won't be subject to the 2.3% medical device tax, pushing off some key provisions but mostly rejecting industry attempts to narrow the scope of the tax, which will go into effect in less than 1 month.
Under the new law medical device manufacturers will be required to make semimonthly tax deposits to the IRS in the amount of 2.3% of every sale, unless the manufacturer's net tax liability does not exceed $2,500 for the quarter.
The news touched off another salvo from industry and its friends on Capitol Hill, which quickly mobilized in calling for swift action in repealing the top-line tax, which is part of the the Patient Protection & Affordable Care Act and slated to go into effect January 1st.
Rep. Erik Paulsen (R-Minn.) said the IRS' move to release the documents so close to the implimentation amounted to the agency telling the industry "good luck."
"Pure and simple, this is bad policy and it’s clearly costing jobs," Paulsen said in a statement. "The regulations released by the IRS today, just 26 days before the tax goes into effect, are placing further burdens on the backs of med tech small businesses that are credited with creating thousands of jobs for our state. There is still time to stop the regulations and stop the tax, but the Senate must act now.”
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