Finding the Hidden Costs in the Medical Device Tax
There continues to be rumblings about the medical device tax from the industry. This article in MassDevice talks about concerns over the hidden cost associated with the legislation. With less than 9 months until the 2.3% sales tax becomes a reality many in the industry are coming to realize that the levy may, in fact, be even more expensive than initial projections indicated.
For example, Bloomington, Indiana-based Cook is working hard to make sure it’s compliant with the new law. They feel this effort will impact profits by 15%. Cook has been one of the industry’s most vocal critics.
Cook Chairman Stephen Ferguson has concerns over the ability of small med-tech firms to overcome the impact of the tax. Firms with less than $100 million in sales make up the majority of the medical device industry. He states, "One thing they may have is fewer products, but they also don't have the resources to apply and figure this out. Plus, if you don't make any money, the tax is still due. That'll be quite an awakening for them."
If you’re a medical device company, how are you planning for the tax? Share your thoughts.