A bipartisan group of House freshmen urged Speaker John A. Boehner Tuesday to fast-track a bill to repeal Obamacare’s tax on medical device makers, arguing the levy is shackling a job-creating industry.
A letter signed by 39 Republicans and four Democrats says the health law’s 2.3 percent tax on sales of pacemakers, artificial joints and other devices places an unfair burden on a sector that employs 400,000 Americans, so the chamber should take up a repeal bill by Rep. Erik Paulsen, Minnesota Republican.
Startup companies are being knee-capped by the tax before they can be profitable, and companies are likely to scale back research and development to offset the tax, they argued.
“This undermines the future of the industry, and puts the discovery of new breakthrough medical technologies at risk,” the lawmakers, led by Rep. Elise Stefanik, New York Republican, told Mr. Boehner.
They said it’s important to act now, providing immediately relief before the issue is overshadowed by a Supreme Court ruling that could strike down Obamacare’s subsidies in at least 34 states.
While many Democrats are loathe to tweak President Obama’s signature health law, the medical device tax is unpopular among liberal members in states where many manufacturers set up shop — among them Minnesota, Pennsylvania and Massachusetts.
Even Sen. Elizabeth Warren, a Massachusetts Democrat and star among progressives, has backed its repeal.
Opponents of repeal say the industry is benefiting from increased business under Obamacare, so it should pay its fair share toward funding the overhaul.
Also, lawmakers would have to come up with more than $20 billion in offsetting costs to scrap the tax without adding to the deficit.
Signers of Tuesday’s letter said revenue from the tax, which took effect in 2013, is about $2 billion per year, or “roughly one half of one tenth of one percent of government spending.”
“Repealing the tax will not have a meaningful impact on the budget, but will be significant for these small business and their ability to continue to grow,” they told Mr. Boehner.
Getting rid of the tax has been a key target for the GOP since 2013, when many Senate Democrats joined Republicans in support of a nonbinding budget amendment to scrap the tax.
The House Democrats who signed onto Thursday’s letter were Reps. Pete Aguilar of California, Brad Ashford of Nebraska, Seth Moulton of Massachusetts and Gwen Graham of Florida.
• Tom Howell Jr. can be reached at thowell@washingtontimes.com.
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