Medical Technology Manufacturers Make First Semimonthly $97 Million Medical Device Tax Payment

MITA, AdvaMed and MDMA Urge Congress to Repeal Job-Killing Device Tax

medtech alliance

Washington, D.C. – A coalition of medical device manufacturers said that today’s first semimonthly payment of approximately $97 million to the IRS for the medical device tax is money that companies would have otherwise been available to invest in research and development (R&D) and American job growth.

“In this difficult economic climate, the medical device tax threatens hundreds of thousands of American jobs as well as life-saving innovation,” said Gail Rodriguez, Executive Director of Medical Imaging & Technology Alliance (MITA). “In spite of the clear economic and clinical value of medical imaging and radiation therapy technologies, Congress has implemented a job-killing device tax, leaving medical device manufacturers with little choice but to reduce their workforce and cut funding for R&D.”

Under the 2.3 percent tax, device manufacturers are now required to pay an estimated average of $194 million per month in medical device tax payments (with a payment of approximately $97 million due semimonthly). This tax threatens a medical device industry that employs more than 400,000 workers nationwide, generates approximately $25 billion in payroll, pays out salaries that are 40 percent higher than the national average ($58,000 vs. $42,000) and invests nearly $10 billion in R&D annually.

“Every dollar spent on this tax is a dollar taken away from medical innovation and job creation. This tax is already resulting in layoffs, reduced investments in R&D and delays in significant capital improvements. We urge Congress to act swiftly and repeal this job-killing, innovation destroying, anti-competitive tax,” said Stephen J. Ubl, President and CEO of the Advanced Medical Technology Association (AdvaMed).

“Instead of investing in new medical technologies or creating new jobs, innovators across the United States wrote a check to the IRS this month,” said Mark Leahey, President and CEO of MDMA. “While the first payments of the medical device tax may have been collected, the resolve and commitment of the medical technology community is stronger than ever to put an end to this bad policy. MDMA and our members remain committed to repealing the medical device tax, but it shouldn’t take more job losses and forgone therapeutic advancements to highlight just how damaging this policy is to a unique American success story.”

MITA, AdvaMed and MDMA urge Congress to repeal the job-killing tax, asking policymakers to consider the real-time harm being inflicted upon the American economy and American patients. The coalition is comprised of MITA, AdvaMed and MDMA.



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