Congressman Fred Upton (R-St. Joseph) today renewed his call for the repeal of a new 2.3 percent excise tax on all U.S. sales of medical devices. Devised under the Affordable Care Act (ACA), this nearly $30 billion tax took effect on January 1, 2013, and has already resulted in employee layoffs at U.S. medical device manufacturers like Kalamazoo-based Stryker Corporation. In addition to endangering tens of thousands of American jobs, this new tax hurts patient access to medical innovation and the competitiveness of this important sector for manufacturing and high-skilled jobs. Upton is an original cosponsor of the bipartisan Protect Medical Innovation Act (H.R. 523) to repeal the medical device tax in full, which was reintroduced today in the U.S. House of Representatives. Similar legislation to repeal the device tax passed the House last summer by a bipartisan vote of 270 to 146, but was never considered by the Senate.
"Only a month since its implementation and we have already witnessed the devastating impact that this harmful new tax is having on manufacturing jobs and innovation here in Michigan and around the country," said Upton. "These are dollars that could be better spent on creating local jobs and making critical investments in life-saving technologies. The President has promised to do whatever it takes to move our economy forward and protect struggling middle class families. Repealing the device tax would be a good step in that direction."
In November 2011, Stryker formally announced its intention to restructure and reduce its global workforce in anticipation of the new tax. In November 2012, Stryker confirmed that the company will lay off roughly 1,000 employees.