November 5, 2014 by Brad Perriello
The impact of the medical device tax on medtech jobs and innovation is ‘relatively small,’ according to a report issued this week by the non-partisan Congressional Research Service.
The impact of the medical device tax is “relatively small” and will affect consumer prices more than the medtech industry, according to a report released this week by the non-partisan Congressional Research Service.
The tax will result in a drop in U.S. output and jobs for the medical device industry of only 0.2%, according to the Nov. 3 study, “The Medical Device Excise Tax: Economic Analysis,” by CRS senior economic policy specialist Jane Gravelle and public finance analyst Sean Lowry.
“These small effects occur in part because the tax is small, in part because demand is estimated to be relatively insensitive to price, and in part because approximately half of production is exempt from the tax,” they wrote. “With relatively small effects on the U.S. medical device industry, it is unlikely that there will be significant consequences for innovation and for small and mid-sized firms.”