SalemNews.com, Salem, MA

Nation/World

December 29, 2012

Medical device makers: Jan. 1 tax could cost jobs

BOSTON — Medical device makers in Massachusetts and elsewhere are warning of potential job losses and other consequences as the industry’s hopes of avoiding a 2.3 percent excise tax fade amid the stalled fiscal cliff negotiations.

The tax, scheduled to take effect Jan. 1, is expected to raise $20 billion over 10 years. It’s one of several taxes imposed on segments of the health care industry to help pay for President Barack Obama’s health care overhaul.

Lobbyists for medical device makers say implementation of the tax could jeopardize about 43,000 jobs nationwide in a $64.7 billion industry. They say companies have shed about 6,000 jobs in the past year, some in anticipation of the tax, while others might scuttle expansion plans or cut back on research that can lead to medical breakthroughs.

“It’s been a year of uncertainty, and now we are looking at this tax coming at us,” said Thomas Sommer, president of the Massachusetts Medical Device Industry Council. “And until it really goes into effect, we are not going to know where the reductions in other areas are going to come.”

The industry has been trying for much of the past year to persuade Congress to repeal or at least delay the tax, and it still clings to the slim hope that a postponement could be attached to any fiscal cliff deal that might be reached in Washington in the coming days.

In Massachusetts, the nation’s second-largest medical device producer behind California, the repeal effort has been embraced by Democrats who are otherwise avid backers of the federal health care law.

U.S. Sen. John Kerry and Sen.-elect Elizabeth Warren were among 17 Democratic senators or senators-elect who signed a letter earlier this month asking Senate Majority Leader Harry Reid to support a delay in the tax. Opposition to the tax was a rare area of agreement between Warren and Republican U.S. Sen. Scott Brown, who opposes the federal health care law, during their recent campaign.

Text Only | Photo Reprints
Nation/World

Local News
  • Salem's Collins seeks longer day

    SALEM -- Collins Middle School may look a little different next year. For starters, longtime Principal Mary Manning, who has headed the school for more than 20 years, is retiring and will be replaced by a new, yet-unnamed principal. More than that, t

    April 19, 2014 6 Stories

  • 140418_SN_KYU_WALK_2 Walking the Walk BEVERLY -- Four hundred thirty walkers, 10.5 miles and $65,000. Those are the numbers you can count on just about every year from the Good Friday Walk. The 35th annual walk produced those figures once again yesterday, with the money going to help nee

    April 19, 2014 2 Photos

  • Marblehead chief charts drop in crime MARBLEHEAD -- Police chief Robert Picariello has highlighted an overall drop in crime from 2012 to 2013 in his annual report to the town. The decrease was substantial in the category of crimes against persons, down 23 percent for incidents like rape,

    April 19, 2014

  • North Shore residents to run in 2014 Boston Marathon

    The Salem News asked those on the North Shore who are running this year's Boston Marathon to share their reasons for running. 

    If you're running the marathon this year, it's not too late to share why you're running. Send a brief paragraph, a photo of yourself and a link to your fundraising site (if applicable) to Cheryl Richardson at crichardson@salemnews.com.

    April 17, 2014

  • One-way school bus passes to get trial run in Peabody PEABODY -- Students will be able to ride the school bus one way next year without paying the price of a round-trip fare. The School Committee has agreed to offer one-way passes on a trial basis following review of transportation data and a proposal f

    April 19, 2014