Klobuchar, Franken Seek Delay of New Med-Device Tax
U.S. Senators Amy Klobuchar and Al Franken are seeking to delay a tax on the medical device industry that is scheduled to take effect on January 1.
The two senators from Minnesota are among 18 Senate leaders who signed a letter addressed to U.S. Senate Majority Leader Harry Reid, urging for a delay in implementing the 2.3 percent tax on medical device sales that is part of the Affordable Care Act.
“The medical device industry has received little guidance about how to comply with the tax—causing significant uncertainty and confusion for businesses,” the letter stated.
Minnesota is home to hundreds of medical device companies that together employ thousands.
According to a Star Tribune report, the 18 leaders’ goal is to ultimately repeal the tax, and Klobuchar told the newspaper that delaying the tax would give them the opportunity to repeal or reduce the tax.
The delay would give opponents more time to present a different source of federal income or new budget cuts to offset lost device tax revenues, according to the Star Tribune. The tax is reportedly expected to add $28 billion over the next decade to help pay for health care reform.
Businesses, including many in Minnesota, have reportedly claimed that the tax would hurt profits and lead to job losses in the country, and both Klobuchar and Franken agree. Klobuchar told the Star Tribune that device tax opponents “have a strong argument to make about the burdens of this tax.”
Meanwhile, supporters of the tax reportedly believe that changes brought by the Affordable Care Act will add millions of new patients, bringing medical device companies millions of new users and thus new income.
To read the full Star Tribune story, click here.