Minnesota is home to more than 700 medical device companies that employ approximately 35,000 people

WASHINGTON, DC – Today, U.S. Senator Amy Klobuchar and Representative Erik Paulsen announced that after efforts from them and other lawmakers, a two-year suspension of the medical device tax has been included in a bipartisan, year-end ‘tax extenders’ agreement. The proposed package suspends the 2.3% excise tax on the sale of medical device products like pacemakers, ultrasound machines, ventilators, and artificial hips through December 31, 2017. Klobuchar and Paulsen have led efforts that would repeal the tax permanently. Minnesota is home to more than 700 medical device companies that employ approximately 35,000 people. The tax extenders bill is expected to receive votes in both chambers in the coming days.    

I opposed the medical device tax from the start and have led Senate efforts with Sen. Hatch to repeal it because of its impact on manufacturing and innovation in Minnesota and across our country,” said Klobuchar. “After a lot of hard work, Democrats and Republicans came together today to suspend this harmful tax for two years. I will continue working with Rep. Paulsen and my colleagues in the Senate to end this tax permanently. Doing so will improve patients’ lives, create well-paying jobs and give Minnesota businesses the certainty and stability needed to keep researching, inventing and developing the next lifesaving medical breakthrough.”

“We’ve seen the harmful, job-crushing effect that taxes in Obamacare are having on our small businesses, and the medical device tax has been one of the worst,” said Paulsen. “It’s driven innovation overseas, harmed job creation here at home, and made it difficult for small businesses to grow. That’s why I’ve championed this bipartisan provision that repeals the tax for two years to prevent further job losses and remove an unnecessary burden for Minnesota innovators that manufacture life-saving and life-improving products.”

As a co-chair of the bipartisan Medical Technology Caucus, Senator Klobuchar has consistently fought for Minnesota medical device companies and has been a leader in the effort to reduce or repeal the medical device tax. During the health care reform debate Klobuchar fought to cut the tax in half, resulting in a $20 billion reduction in the tax and a one year delay in the implementation. Klobuchar also led the effort in 2012 to delay the implementation of the device tax, and successfully secured 17 other Democratic Senators to join her in a letter to then-Senate Majority Leader Reid urging delay. In 2015, Klobuchar introduced the Medical Device Access and Innovation Protection Act with Senator Orrin Hatch (R-UT). This bill would repeal the medical device tax for manufactures and importers.

Paulsen has long championed the legislation repealing the medical device tax in the House and legislation he authored, the Protect Medical Innovation Act, passed the House earlier this year by a bipartisan vote of 280-140. Last year, he authored an opinion piece in the Wall Street Journal on the need to repeal the burdensome tax.