Indiana Senator Takes Stand Against Device Tax

Eliminate the tax on medical device makers—that was the message of Sen. Dan Coats’ (R-Ind.) speech addressing the Senate on Sept. 12.

Coats labeled the 2.3 percent device sales tax part of the “pay-fors” in the 2010 healthcare law, and said that it might lead to job losses in Indiana.
The state’s 300 device companies employ 20,000 people who have salaries that are about 41 percent higher than the state average.

“What [those device companies] have said to me is, ‘We like working here in Indiana; we like the productivity that we’re getting; but if we continue to be taxed and regulated to the point where we are no longer competitive selling our product worldwide, we are going to have to take a serious look at moving our production overseas,’ ” Coats said.

Coats has co-sponsored a bill that would repeal the medical device tax, which is scheduled to take effect in 2013.

Obama’s jobs proposal, which was revealed Sept. 8, received endorsement from a dozen U.S. senators, six House members, eight governors and five mayors of large cities. This group included only one Republican, Michigan Governor Rick Snyder.

No Hoosier lawmakers were among the announced supporters.

“This is one industry, and I hope to highlight more in the future, that is clearly
being penalized for being successful, and it’s hurting our economy, and it’s hurting our ability to provide job growth,” Coats said.