Whitaker in his letter today congratulated Trump on today’s passage of the Republican-backed tax plan, while noting that Congress has failed to suspend the 2.3% levy imposed on U.S. medical device sales by the Affordable Care Act in 2013.
A hold on the medical device tax went into effect at the beginning of 2016 and is slated to expire by the end of this year.
“In 11 days, the medical device excise tax is set to be reinstated, meaning a massive tax increase is on its way. I am writing to you to underscore the devastating impact this tax has and will have on our industry. I know you have long supported repealing this onerous tax. I want to emphasize why, unlike other business taxes, retroactive relief from the device tax is not feasible and why action this year is essential,” Whitaker wrote.
AdvaMed has long argued that the medical device tax has caused the industry to lose jobs or put off creating jobs, as well as stifle innovation by cutting R&D and slowing capital expansion.
“It is vital that you work with Congress to ensure they do not take a step backward and allow this devastating tax to be reinstituted on the industry. Retroactive action by Congress next year cannot fully undo the impact of allowing this tax to be triggered on January 1. Short of legislative action, I would strongly encourage you to direct the Treasury and IRS to provide whatever administrative relief you can. I would refer you to our November 10 letter to the IRS where we lay out the steps that can be taken to waive the bi-weekly deposit requirements,” Whitaker added.
“Addressing the device tax now will provide medical technology innovators with the certainty necessary to support future job growth and sustainable, cutting-edge R&D that will ultimately lead to the next generation of breakthroughs in patient care and treatment.”