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Medical Device Tax May Be Scrapped

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(credit: CBS)

(credit: CBS)

CBS Minnesota (con't)

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MINNEAPOLIS (WCCO) – A tax on pacemakers and other medical devices made in Minnesota may be going away.

Since January there’s been a 2.3 percent tax on medical device sales with the revenues earmarked to help pay for the new national health care reform law.

But there’s been strong opposition from Minnesota manufacturers and the state’s congressional delegation.

“A lot of companies have had to choose between laying off employees and paying the new excise tax. And it’s a tax on sales, not on profit … so that’s why it’s been so harmful,” Republican Rep. Erik Paulsen said.

Democratic Senator Amy Klobuchar, who helped push passage of an amendment to repeal the tax, notes that 30,000 Minnesotans work in the medical device industry.

“We have over 400 companies — big ones like Medtronic and St Jude Medical — but we also have smaller ones,” Klobuchar said.

A separate senate bill will be needed for a repeal to take effect, but the strong bipartisan support increases the likelihood the tax will be cut.

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