Bill Calls to Repeal Excise Tax
Rep. Paulsen’s H.R. 5095 calls for end to health reform’s tax on DME manufacturers.
- By David Kopf
- Apr 29, 2010
Rep. Erik Paulsen (R-Minn.) has introduced H.R. 5095, the Defend Medical Innovation Act, which calls for the repeal of the $20 billion excise tax on DME manufacturers that was brought into law by the recently passed healthcare reform legislation, the Health Care and Education Reconciliation Act of 2010.
Paulsen, Co-Chair of the House Medical Technology Caucus, introduced the legislation with 26 original co-sponsors representing Congressional districts across the United States. Since its debut, three additional co-sponsors have signed onto the legislation.
The manufacturer’s excise tax was modified in H.R. 4782, the reconciliation bill that followed the Patient Protection and Affordable Care Act (H.R. 3590), to reduce the excise from a 2.9 percent tax to a 2.3 percent tax. The excise tax goes into effect on Jan. 1, 2013, and is estimated by The Joint Tax Committee to raise $20 billion over 10 years.
“The medical technology industry is an American success story, responsible for life-saving technologies and tens of thousands of jobs in Minnesota alone" Paulsen said. "Once it takes effect, this tax will harm job growth, slow innovation and raise costs. The right thing to do is stop this tax now, before its negative impact takes hold."
A statement from Paulsen labeled the medical device industry “a key sector in the United States economy” and noted two sets of facts from International Trade Association that illustrate its role in the economy:
- Approximately 8,500 medical device firms in the United States employ more than 350,000 people.
- The average salary for workers in the medical device sector is $70,000, or 49 percent more than the average private sector job, and 18 percent more than the average manufacturing job. High-paying jobs like those in the medical equipment industry create additional jobs elsewhere in the economy because of the greater income generated.
About the Author
David Kopf is the Editor of HME Business.