MASSDEVICE ON CALL — A congresswoman from upstate New York is asking President Barack Obama to repeal the medical device tax that’s now just 3½ months away.
Prompted by local medical device company Welch Allyn’s decision to cut 10% of its workforce because of the 2.3% sales tax, Buerkle urged Obama to work with Senate leaders to enact a repeal bill the House approved this year.
Welch Allyn said Sept. 10 that it plans to shed 275 of its 2,750 positions worldwide to compensate for the impending levy. The tax, part of the Patient Protection & Affordable Care Act, is slated to go into effect in January 2013. It applies to all U.S. sales of medical devices.
"Medical device manufacturing, a field which is one of the few manufacturing sectors to experience growth over the last few years, will be affected across this nation and subsequently disadvantaged around the world," Buerkle wrote. "Members of the House of Representatives rightly recognized the impact that the tax will have on the medical device industry, passing HR 436 on a bipartisan basis in June of this year to repeal the tax. The Senate has failed to take up the bill for consideration.
"Last April, you signed into law HR 4, which repealed the 1099 reporting requirement for small businesses. I commend you for doing the right thing for small businesses then, and I ask you to once again stand with them in repealing the medical device tax," she wrote. "I urge you to work with Senate leadership to pass this vitally important legislation and sign it into law before this tax does any further damage."
The Welch Allyn layoffs are part of a series of cost-cutting moves made by large medical device companies in the past several weeks that have resulted in the loss of roughly 2,000 jobs across the industry.
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