If President Barack Obama wants to strengthen small businesses, as he said during the Democratic National Convention earlier this month, he’d do well to start by repealing the 2.3% medical device tax contained in his Affordable Care Act, according to Reps. Pat Tiberi (R-Ohio) and Erik Paulsen (R-Minn.).
"The good news is that we already have a dynamic industry that addresses all of the ideas the president touched on,," according to an opinion column written by the Reps for the Newark Advocate. "The bad news is that one of President Barack Obama’s own policies is a major roadblock for the industry’s continued success."
Tiberi and Paulsen went on to laud the U.S. medical device industry, which they said represents 47,000 jobs in Ohio alone. More than 80% of the industry is made up of companies that are smaller than 50 employees, they added, and the tax will have an especially damaging impact on the smaller firms which have not begun making a profit.
"We know of dynamic, cutting-edge medical device manufacturers in our districts who employ dozens of workers, but aren’t profitable yet," the duo wrote. "Are we really going to tell these innovators that they owe a tax bill to the Internal Revenue Service when they have not yet made a penny of profit?"
Rep. Paulsen in particular has been a vocal opponent of the medical device tax, spearheading efforts it the House of Representatives to repeal the levy.
Earlier this month Paulsen pressed an IRS representative for answers on the medical device tax during a hearing at the U.S. House of Representatives, asking IRS deputy commissioner Steven Miller whether the tax agency has given any consideration to the administrative burden complying with the tax would entail.
"Now that we’re moving forward to January 1st, these companies are laying off employees already. I want to make sure that we’re taking into account the paperwork," Paulsen said during the House Ways and Means Subcommittee on Oversight hearing on implementing President Barack Obama’s healthcare reform law.