Repeal the Medical Device Tax … But Not Yet

 

Picking up on a point I hinted at in my post on Friday, Republicans need to think very carefully — and strategically — about repealing Obamacare’s medical device tax. There’s no question that the tax is destructive — but the same is true, on a much grander scale, of Obamacare as a whole. And we have to recognize that repealing the former on its own may make it harder to get rid of the latter.

The medical device industry has reportedly already spent $30 million trying to get the GOP to kill the tax. But if Republicans go along with that plan, the industry’s support for the broader repeal/replace agenda will evaporate as soon as they get what they want.

Here’s a solution: place a moratorium on the tax until 2017. That provides the same relief to the medical device industry in the short-term without removing their incentive to join the bigger fight. It keeps the GOP from setting a terrible precedent for providing special relief to individual corporate interests. And it avoids the appearance that Republicans care more about moneyed backers than average Americans.

For a more thorough version of this argument, you can read the piece that Hadley Heath Manning and I published last week at The Hill.

What do you think?

There are 2 comments.

Become a member to join the conversation. Or sign in if you're already a member.
  1. MJBubba Inactive
    MJBubba
    @MJBubba

    I disagree.   Republicans should do nothing, and promise to bring up a repeal of this tax as part of the package of laws that will be rolled out to replace Obamacare in 2017.

    Obamacare was enacted democratically, by a strict party-line Democrat vote, and is Obama’s signature accomplishment.   Republicans should not “improve” on it by tweaking around the edges.   Republicans should be busy hammering out a package to replace it entirely in early 2017.

    The people elected Democrats, and this is a piece of democracy that they should get good and hard.

    • #1
  2. ctlaw Coolidge
    ctlaw
    @ctlaw

    Heather Higgins: Here’s a solution: place a moratorium on the tax until 2017. That provides the same relief to the medical device industry in the short-term without removing their incentive to join the bigger fight.

    There are several effects of the tax and this only affects some.

    Those effects (really aspects of a single effect) are short term sales, consumer costs, and producer cash flow.

    Another effect is the disincentive to present investment in future production. The present investment in the long term is itself a short term effect. That is based on the expectation of whether the tax will be there in the future.

    .

    • #2

Comments are closed because this post is more than six months old. Please write a new post if you would like to continue this conversation.