A bipartisan clutch of freshman representatives yesterday asked Rep. Paul Ryan (R-Wis.), the newly minted House Speaker, to schedule a vote on repealing the medical device tax by the end of the year.
The 2.3% excise tax on U.S. medical device sales went into effect in 2013 as part of Obamacare. The “Protect Medical Innovation Act of 2015,” or H.R. 160, sponsored by Rep. Erik Paulsen (R-Minn.), would repeal the tax and refund any payments received from medtech companies.
Led by Rep. Elise Stefanik (R-N.Y.), the 44 new representatives want Ryan to include Paulsen’s measure in a larger legislative packet before the end of 2015.
“The medical device tax is a tax on revenue, rather than profit, which means that the U.S. device industry is subject to one of the highest corporate tax rates in the world,” they wrote. “As companies look to make cuts to offset the tax, research and development is often one of the first items to go. This trade-off undermines the future of the industry and puts the discovery of new breakthrough medical technologies at risk.”
In June, 46 Democrats joined the vote to approve H.R. 160; last month, the House passed the Restoring Americans’ Healthcare Freedom Reconciliation Act, which included the Protect Medical Innovation Act‘s provision that would eliminate the levy.
The measure sponsored by Paulsen, who this week was tapped to serve on the powerful House Ways & Means Committee’s health sub-panel, is 1 of several repeal bids circulating on Capitol Hill. The Senate’s corresponding repeal bid, sponsored by Sen. Orrin Hatch (R-Utah), is S. 149 or the “Medical Device Access & Innovation Protection Act.” The Hatch measure has 39 co-sponsors, including Democratic Sens. Joe Donnelly of Indiana, Ben Casey of Pennsylvania, Jeanne Shaheen of New Hampshire and Minnesota’s Amy Klobuchar and Al Franken.
A pair of Democrat-led bills would also repeal the tax, but unlike the Hatch and Paulsen measures, those bills would replace the lost revenue by closing tax loopholes for the energy industry.
A bill by Sen. Ed Markey (D-Mass.), S. 844 or the “No Taxation on Device Innovation Act,” has no co-sponsors. Its counterpart in the House, H.R. 1533 or the “Medical Device Tax Elimination Act” sponsored by Rep. Alma Adams (D-N.C.), has 10 co-sponsors, all Democrats.
