George Schutzer and Paul Rubin, partners in the firm’s Washington office, were featured in The Gray Sheet on August 16, 2010 discussing the medical device excise tax that will be implemented in 2013.
The provision, stemming from the health care reform legislation, will institute a 2.3 percent tax on most medical device sales in the U.S. Many medical industry professionals would like to repeal or revise the measure, while some attorneys advise those in the industry to seek answers from the government on how implementation will happen. Some concerns surrounding the provision focus on questions regarding the types of devices that will be exempt from the tax, according to the article.
“Before Treasury actually begins to do anything, it is a lot easier to have informal conversations,” Mr. Schutzer said. “This is really a good time to go in and broadly discuss the nature of the problems and ... the procedures that might be used by Treasury.”
Medical devices considered by the Treasury as “generally purchased by the general public at retail for individual use,” such as hearing aids and eyeglasses are exempt from the tax. Determining which devices will be exempt is a cause for concern to some in the industry and attorneys.
“There are many classes of products that are only medical devices if you make certain claims for them,” Mr. Rubin said. “These types of ‘dual use’ products - capable of regulation by the Consumer Product Safety Commission as consumer products, or FDA as medical devices, depending upon claims - are potentially subject to the excise tax.”