We find ourselves in the middle of one of the greatest wealth transfer periods of all time. Those with wealth must decide whether they want to make transfers, and if they do, they must decide how much, to whom, when and in what structure?
Sponsor Generated Content
U.S. Reps. Erik Paulsen, R-Minn., and Ron Kind, D-Wisc., introduced the measure with a bipartisan group of 175 co-sponsors in the House. U.S. Sens. Orrin Hatch, R-Utah, and Amy Klobuchar, D-Minn., will introduce a similar bill in the Senate.
“Companies have already laid off thousands of employees as a result of this onerous new tax, and more jobs will be lost now that this tax is in effect,” Paulson said in a statement. “It’s not only costing our country jobs and deterring innovation, but more importantly, it will reduce patient access to cutting-edge medical products and treatments that save lives.”
The Affordable Care Act taxes gross sales receipts of more than $5 million for manufacturers and importers of medical devices such as prosthetic limbs, defibrillators, X-ray machines, pacemakers, surgical tools and stents.
The tax is supposed to raise nearly $30 billion in the next decade to fund health care reform, and the Obama administration argues the medical-device industry stands to gain from expanding coverage. Opponents say the tax will strain the capital-intensive medical-device industry.
Northern Colorado companies have complained about the medical device excise tax, saying it has led them to lay off employees and has stifled innovation.
Colorado BioScience Association CEO April Giles was in Washington, D.C. on Wednesday to support efforts to repeal the bill. Companies statewide have cut jobs or halted hiring because of the tax, Giles said.
The tax on companies, regardless of whether they earn a profit, increases companies’ effective tax rates from 15 to 40 percent, she said.
“It really takes their corporate tax from, maybe 39 percent, to 55 percent to 80 percent of all revenue,” Giles said. “That, again, hurts the abilities of companies to grow either through job creation or to funnel that money back into innovative products.”
A bill to repeal the tax passed the House last year, but the Senate did not back it, and President Obama threatened to veto it.
Giles believes this year’s bill has more momentum, although some lawmakers have concerns about how to offset a loss in tax revenue, she said.
Colorado Sen. Mark Udall “is not planning on introducing or pushing for any a la carte legislation on the medical device tax,” a Udall spokesman said in an email. “That said, he is open to revisiting the issue as part of a broader tax-reform discussion.”
Rep. Jared Polis supports repealing the medical device tax, a spokesman said in an email.
“In terms of any specific bill, it would depend on how you pay for it,” the spokesman said.
Rep. Cory Gardner, R-Yuma, is a co-sponsor of the bill.