October 3, 2014 by Brian Johnson
The medical device tax has achieved such a hat trick of futility that you couldn’t blame medtech for boycotting the 2.3% excise levy.
The medical device tax is like a bad public school teacher: It’s a drain on the system and seemingly impossible to get rid of.
In just 21 months, the 2.3% levy has achieved a unique hat trick of futility. How else could you describe a tax that’s highly inefficiant, fundamentally ineffective and disproportionately damaging to 1 of the few net exporting industries left in the U.S.?
In recent months, we’ve learned that the following about the medical device tax:
- The IRS collected only $1.4 billion in medtech tax revenues in 2013, as revealed in aMassDevice.com exclusive, far shy of just about every estimate.
- The IRS “cannot identify the population of medical device manufacturers“ ought to be making semi-monthly deposits on the tax, according to the U.S. Treasury Dept. The IRS collected a little more than $913 million during the 1st half of 2013, well shy of the $1.2 billion it expected.
- The IRS wildly overestimated the number of medical device tax returns filed during the 1st half of 2013 (9,000-15,000) versus the roughly 5,100 returns medtech companies actually filed.