“Medical device makers fear new tax would cripple them,” The Gainesville Sun reports today, “saying it will cost thousands of jobs and stifle the development of products designed to improve patients’ lives.” According to a new report released by the American Action Forum, those fears are well founded. The report finds as many as 47,100 jobs are in jeopardy as the ObamaCare medical device tax takes effect next year, with many companies already announcing layoffs in anticipation of the higher costs. The House will vote on H.R. 436 this week to repeal this onerous ObamaCare provision and protect the thousands of small business jobs hit hardest by the new tax. Here are a few additional findings from the report:
- “Job losses could reach as high as 47,100,” as a result of the ObamaCare tax, representing 10 percent of the total medical device industry workforce.
- The ObamaCare tax hits small businesses, “who are less able to absorb the lost revenue as a result of higher fixed costs and smaller cash reserves,” the hardest. Around 80 percent of American medical device manufacturers are small businesses.
- The ObamaCare tax is already holding back job growth and medical innovation, with venture capital investment in medical device firms “down over 50 percent” in 2011 “compared to any of the previous five years.”
The report concludes:
“If left in place, medical device industry employment will decline, medical device startups and small businesses will decline, and U.S. leadership in the medical device industry will decline. The medical device excise tax is bad tax policy, bad economic policy and bad healthcare policy.”
This week’s vote to repeal the medical device tax is part of Republicans’ summer agenda that is “heavy on jobs,” and another step in the ongoing effort by the Republican-led House to repeal ObamaCare – an ill-conceived law that is making it harder for small businesses to hire - in its entirety. Learn more about Republicans’ effort to fully repeal ObamaCare here, and see what else we’re doing to help create a better environment for private-sector job growth with the Republican Plan for America’s Job Creators at jobs.gop.gov.
Read the full American Action Forum report here: