by Loren Bonner
, DOTmed News Online Editor
Medical device manufacturers paid the IRS $97 million this month, according to a coalition of device manufacturers. The payment is the first semimonthly amount required under the controversial medical device tax that went into effect on Jan. 1, 2013.
"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 the Medical Device Manufacturers Association (MDMA), in a statement.
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MDMA and its industry members, including Medical Imaging & Technology Alliance (MITA) and Advanced Medical Technology Association (AdvaMed), are committed to urging Congress to repeal the excise tax, which was included in President Obama's 2010 health care reform law to help raise roughly $30 billion over 10 years to offset the cost of reform.
The 2.3 percent excise tax applies to the sale of medical devices by manufacturers and importers. Manufacturers are required to pay an estimated $194 million per month in medical device payments — that comes out to roughly $97 million semimonthly, as evidenced by this first payment to the IRS from manufacturers.
According to the statement, the tax threatens a medical device industry that employs more than 400,000 workers in the U.S., generates approximately $25 billion in payroll 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 AdvaMed, in the statement.