CLSA in FierceMedicalDevices: Medical device tax repeal included in proposed $1.1T spending bill
December 16, 2015 | By Varun Saxena, FierceMedicalDevices
A two-year suspension of the 2.3% medical device excise tax is included in a $1.1 trillion spending bill that is expected to receive a vote in the House this week, to the delight of industry and med tech associations.
Passage would mark victory in a long and hard battle on the part of the device industry to repeal the tax that funds the Affordable Care Act. The tax went into effect in 2013. It does not apply to devices bought by consumers, such as contact lenses.
AdvaMed and fellow med tech associations the Medical Imaging & Technology Alliance (MITA) and the Medical Device Manufacturers Association (MDMA) released a joint statement applauding Congress for including the suspension of the tax in the comprehensive spending bill.
“MITA is encouraged by the inclusion of the two-year suspension of the medical device tax in the tax extenders package, which comes at a crucial time for the medical technology industry,” said MITA Board Chairman Nelson Mendes, who is the CEO of Ziehm Imaging, in a statement. “The tax has been a drain on the economy and has halted investment in research and development for advanced imaging and other life-saving technologies. We appreciate the bipartisan efforts of Congress in taking this step to protect U.S. jobs and innovation, and we urge them to support the legislation.”
The California Life Science Association also chimed in, saying in a statement “Since its inception nearly 5 years ago, there has been increasing bipartisan support to scrap the medical device tax. While a two-year delay is welcomed news, CLSA and our device members will continue to advocate for full repeal of the tax, which is expected to cost firms nearly $25 billion and continues having an adverse impact on R&D investment and job creation, jeopardizing the U.S. position as a global leader in medical device innovation. California is home to over 1,500 medical technology companies, more than any other state in the nation, employing over 75,000 people with wages averaging $91,000 a year, making the impact of the tax on our state particularly troublesome.”
Also included in the gigantic spending bill is a repeal of the so-called Cadillac Tax on high-cost health insurance plans.