Medical Device Tax Will Face Congressional Scrutiny
November 6, 2014
The Medical Device Tax levied as part of the Affordable Care Act is likely to be re-examined as a result of Tuesday’s election. The tax is controversial, especially in Minnesota, where the medical device industry employs a lot of people. In a symbolic vote last year, 79 senators voted for a repeal of the tax in a budget amendment sponsored by senior Minnesota senator Amy Klobuchar. However, Senate leadership has not allowed an actual binding repeal to come to the floor. After the change in Senate leadership from Tuesday's election, a repeal of the tax is more likely to make it to a vote.
This repeal would be welcome. The tax is complex and narrowly-targeted at a single industry. This is the precise opposite of tax experts consider to be good policy. Recently, a Treasury Inspector General report found that both the IRS and the medical device manufacturers were having a hard time enforcing and complying with the complex tax.
This tax is problematic, unpopular, and in violation of every reasonable principle of economics or sound public policy. It should go.