Mr. GENE GREEN of Texas. Mr. Speaker, I oppose H.R. 436 but I am opposed to the Medical Device Excise Tax. I support the Affordable Care Act, but just like all bills, it was not perfect.
In Texas, the medical device industry supports nearly 55,000 jobs. It is an industry at the cutting edge of technological innovation and is critical to addressing many of the health challenges we face now and will in future. I believe this industry, just like any other, should pay their fair share, but I am worried that a tax like this will chill innovation. The tax is on revenue and not profits, which will have a disproportionate effect on small and mid-sized companies. Medical devices are incredibly expensive to develop and it takes a lot of revenue to offset overhead. By taxing revenue, instead of profit, it adds additional costs. Most business taxes are calculated on the profits after expenses, but this one is not.
A company near our district in Houston, Cyberonics, employs hundreds of Americans. A few years ago, I toured their facilities. I was surprised to learn that they did all of their manufacturing in-house, in Houston. This is an increasingly rare way to do business, but one we should encourage. Their company is a good example of American innovation and entrepreneurship. I am concerned that the way this tax is structured, it will negatively impact Cyberonics and companies like it. We should be taking steps to support research, design, and manufacturing job growth in our country.
While I oppose this tax, I am also opposed to the way this bill pays for the repeal of the tax. We should not replace a poorly designed policy with more poorly designed policies. This bill shifts the cost on to low and middle income earners and potentially risks their health insurance coverage under ACA.
We should find a better way to fix this and I want to work with my colleagues to craft a compromise that will not endanger American jobs but at the same time won't shift significant costs on to those who can least afford it.