09/25/2019 | Press release | Archived content
iBIO along with The Advanced Medical Technology Association (AdvaMed), the Medical Device Manufacturers Association (MDMA), the Medical Imaging & Technology Alliance (MITA) and a broad coalition of medical innovators, physician inventors, patient groups, and others sent a letter to congressional leadership yesterday urging them to permanently repeal the medical device excise tax.
The medical device tax is a 2.3 percent levy on the sale of nearly every medical device sold in the country-from pacemakers and stents to MRI machines and CT scanners. The tax has previously been suspended by Congress twice, but absent Congressional action the most recent suspension will expire on January 1, 2020- a reality which threatens to once again undermine jobs, patients, and important breakthroughs in medical innovation.
Illinois is home to over 550 medical device companies, directly employing 13,000 Illinois workers. With $5.7 billion in economic output, the medical device industry is an important driver for the Illinois economy.
Despite the suspension of the tax, the medical device tax still has an adverse impact on R&D investment and job creation. For an industry that is built on constant innovation R&D spending has dropped in recent years, declining to 4.7% in 2013-17 from an average of 15.5% in 2000-07. (EY Pulse of the Industry 2018).
In all, over 600 signatures were on the letter urging lawmakers to repeal this economically harmful and innovation stifling tax. You can read the letter to congress here.