Congressional inaction on medical device tax will cost 21,390 jobs in next two years

Congressional inaction on medical device tax will cost 21,390 jobs in next two years

Press releases may be edited for formatting or style | December 05, 2019
WASHINGTON, D.C. – A new analysis released today by the nonpartisan Tax Foundation reports that the return of the medical device excise tax would lead to a loss of 21,390 U.S. medical technology jobs and a $1.74 billion decline in the nation’s GDP.

“Congressional inaction on the medical device tax will cost more than 21,000 jobs in the next two years. We’ve seen this before – and we’re less than a month away from seeing it again if Congress doesn’t act now,” President and CEO of AdvaMed Scott Whitaker said. “This report confirms common sense and illustrates why there’s broad bipartisan consensus in Congress that the medical device tax is bad for jobs, is flawed health and tax policy, and ultimately hurts American patients. We urge Congress to permanently repeal this tax before adjourning this year.”

The Tax Foundation report cites the nearly 29,000 decline in industry jobs, as well as decreases in R&D spending and device sales when the tax was in effect from 2013 through 2015. These reductions, the analysis says, led to “less innovation and as a result, worse patient care.” The Foundation also notes that the medical device excise tax “violates multiple principles of sound tax policy...The tax is neither simple, transparent, nor neutral, to the detriment of taxpayers and those in need of medical devices.”

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Whitaker continued: “The first time this tax was in effect, we saw massive job losses in the first two years. That’s just the nature of an excise tax. And in an industry that’s 80 percent small businesses, cutting jobs quickly is unfortunately the only way to keep the doors open. That’s not smart health policy. And since this tax must be paid starting in January, putting off repeal until the new year is not an option for the patients who depend on these companies for the medical technologies that improve and save their lives.”


AdvaMed member companies produce the medical devices, diagnostic products and health information systems that are transforming health care through earlier disease detection, less invasive procedures and more effective treatments. AdvaMed members range from the largest to the smallest medical technology innovators and companies.

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