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Beware the ‘jobs killer’ Companies threaten to quit state over new tax on medical devices
The Boston Herald ^ | March 25, 2010 | Jay Fitzgerald

Posted on 03/25/2010 6:09:58 AM PDT by AU72

A dire warning from Bay State medical-device companies that a new sales tax in the federal health-care law could force their plants - and thousands of jobs - out of the country has rattled Gov. Deval Patrick, a staunch backer of the law and pal President Obama.

“This bill is a jobs killer,” said Ernie Whiton, chief financial officer of Chelmsford’s Zoll Medical Corp., which employs about 650 people in Massachusetts. Many of those employees work in Zoll’s local manufacturing facility making heart defibrillators.

“We could be forced to (move) manufacturing overseas if we can’t pass along these costs to our customers,” said Whiton.

The threat - echoed by others in the critical Massachusetts industry - had the governor vowing to intervene to block the sales tax impact.

“I am obviously concerned about the medical device burden here on the commonwealth, which has a very robust industry around medical devices,” Patrick said yesterday.

He ticked off his past support for the life-sciences industry. But he added that “you better believe I will work to make modifications” if the bill is found to be an “impediment to that industry.”

Medical-device makers - part of the life-sciences sector that’s been one of only a few fields creating jobs during the recession - are warning that the new sales tax could cripple many companies, especially small firms with razor-thin profit margins.

Under the legislation signed by Obama, medical-device companies would be slapped with a sales tax of about 2.9 percent to raise about $2.2 billion a year to pay for the health-care overhaul. Under a companion “reconciliation” bill now being debated in the Senate, the tax is set at 2.3 percent and would start Jan. 1, 2013.

Most political observers expect the reconciliation bill to pass - with the 2.3 percent medical-devices tax. The tax exempts eyeglasses, contact lenses, hearing aids and all products generally found in drug stores, from bandages to toothbrushes.

But it hits more sophisticated medical instruments and equipment, a specialty of hundreds of firms in Massachusetts.

“They’re beating up on the guys doing the best to create jobs,” said Tom Taylor, chairman of the Massachusetts Medical Devices Industry Council and founder of Roush Life Sciences.

U.S. Sen. Scott Brown (R-Mass.) is pressing for elimination of the proposed sales tax, as part of a larger, last-ditch effort by Republicans to stall specific aspects of the historic $940 billion health-care overhaul signed into law on Tuesday by Obama.

“With unemployment in my state near 10 percent, placing a tax on medical devices is the absolute last thing we should be doing right now,” said Brown in a statement, as he filed an amendment that would repeal the tax.

Despite his concerns, Patrick stood by health care reform yesterday, saying the law is A dire warning from Bay State medical-device companies that a new sales tax in the federal health-care law could force their plants - and thousands of jobs - out of the country has rattled Gov. Deval Patrick, a staunch backer of the law and pal President Obama.

“This bill is a jobs killer,” said Ernie Whiton, chief financial officer of Chelmsford’s Zoll Medical Corp., which employs about 650 people in Massachusetts. Many of those employees work in Zoll’s local manufacturing facility making heart defibrillators.

“We could be forced to (move) manufacturing overseas if we can’t pass along these costs to our customers,” said Whiton.

The threat - echoed by others in the critical Massachusetts industry - had the governor vowing to intervene to block the sales tax impact.

“I am obviously concerned about the medical device burden here on the commonwealth, which has a very robust industry around medical devices,” Patrick said yesterday.

He ticked off his past support for the life-sciences industry. But he added that “you better believe I will work to make modifications” if the bill is found to be an “impediment to that industry.”

Medical-device makers - part of the life-sciences sector that’s been one of only a few fields creating jobs during the recession - are warning that the new sales tax could cripple many companies, especially small firms with razor-thin profit margins.

Under the legislation signed by Obama, medical-device companies would be slapped with a sales tax of about 2.9 percent to raise about $2.2 billion a year to pay for the health-care overhaul. Under a companion “reconciliation” bill now being debated in the Senate, the tax is set at 2.3 percent and would start Jan. 1, 2013.

Most political observers expect the reconciliation bill to pass - with the 2.3 percent medical-devices tax. The tax exempts eyeglasses, contact lenses, hearing aids and all products generally found in drug stores, from bandages to toothbrushes.

But it hits more sophisticated medical instruments and equipment, a specialty of hundreds of firms in Massachusetts.

“They’re beating up on the guys doing the best to create jobs,” said Tom Taylor, chairman of the Massachusetts Medical Devices Industry Council and founder of Roush Life Sciences.

U.S. Sen. Scott Brown (R-Mass.) is pressing for elimination of the proposed sales tax, as part of a larger, last-ditch effort by Republicans to stall specific aspects of the historic $940 billion health-care overhaul signed into law on Tuesday by Obama.

“With unemployment in my state near 10 percent, placing a tax on medical devices is the absolute last thing we should be doing right now,” said Brown in a statement, as he filed an amendment that would repeal the tax.

Despite his concerns, Patrick stood by health care reform yesterday, saying the law is “very good for the people of America and the people of the commonwealth.”


TOPICS: Government; News/Current Events; US: Massachusetts
KEYWORDS: brown; devalpatrick; healthcare; innovation; jobkiller; jobs; massachusetts; massachussetts; obamacare; scottbrown; taxachussetts; zollmedical
LOL. Clueless Gov. Patrick still thinks Obamacare is A dire warning from Bay State medical-device companies that a new sales tax in the federal health-care law could force their plants - and thousands of jobs - out of the country has rattled Gov. Deval Patrick, a staunch backer of the law and pal President Obama.

“This bill is a jobs killer,” said Ernie Whiton, chief financial officer of Chelmsford’s Zoll Medical Corp., which employs about 650 people in Massachusetts. Many of those employees work in Zoll’s local manufacturing facility making heart defibrillators.

“We could be forced to (move) manufacturing overseas if we can’t pass along these costs to our customers,” said Whiton.

The threat - echoed by others in the critical Massachusetts industry - had the governor vowing to intervene to block the sales tax impact.

“I am obviously concerned about the medical device burden here on the commonwealth, which has a very robust industry around medical devices,” Patrick said yesterday.

He ticked off his past support for the life-sciences industry. But he added that “you better believe I will work to make modifications” if the bill is found to be an “impediment to that industry.”

Medical-device makers - part of the life-sciences sector that’s been one of only a few fields creating jobs during the recession - are warning that the new sales tax could cripple many companies, especially small firms with razor-thin profit margins.

Under the legislation signed by Obama, medical-device companies would be slapped with a sales tax of about 2.9 percent to raise about $2.2 billion a year to pay for the health-care overhaul. Under a companion “reconciliation” bill now being debated in the Senate, the tax is set at 2.3 percent and would start Jan. 1, 2013.

Most political observers expect the reconciliation bill to pass - with the 2.3 percent medical-devices tax. The tax exempts eyeglasses, contact lenses, hearing aids and all products generally found in drug stores, from bandages to toothbrushes.

But it hits more sophisticated medical instruments and equipment, a specialty of hundreds of firms in Massachusetts.

“They’re beating up on the guys doing the best to create jobs,” said Tom Taylor, chairman of the Massachusetts Medical Devices Industry Council and founder of Roush Life Sciences.

U.S. Sen. Scott Brown (R-Mass.) is pressing for elimination of the proposed sales tax, as part of a larger, last-ditch effort by Republicans to stall specific aspects of the historic $940 billion health-care overhaul signed into law on Tuesday by Obama.

“With unemployment in my state near 10 percent, placing a tax on medical devices is the absolute last thing we should be doing right now,” said Brown in a statement, as he filed an amendment that would repeal the tax.

Despite his concerns, Patrick stood by health care reform yesterday, saying the law is “very good for the people of America and the people of the commonwealth.”

1 posted on 03/25/2010 6:09:58 AM PDT by AU72
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To: AU72

Too bad they’d have to move overseas. I am sure real states like Texas would be more than happy to have them.


2 posted on 03/25/2010 6:13:24 AM PDT by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: AU72
“They’re beating up on the guys doing the best to create jobs,” said Tom Taylor

We're talking about Obama here -- what did you expect??

3 posted on 03/25/2010 6:13:47 AM PDT by ClearCase_guy (I do not want the Union to be maintained. I want the US to break up. I support secession.)
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To: AU72
A dire warning from Bay State medical-device companies that a new sales tax in the federal health-care law could force their plants - and thousands of jobs - out of the country

But... but... Unicorns! Skittles! Rainbows! Hope! Change!

4 posted on 03/25/2010 6:19:54 AM PDT by ScottinVA (RIP to the country I love...)
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To: AU72

Your gov must have been bright enough to know that any new taxes would hurt business in an already tax-heavy state.
Nobody is that stupid, right?


5 posted on 03/25/2010 6:20:05 AM PDT by LFOD (Presently - Back in Dixie)
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To: pnh102
Too bad they’d have to move overseas. I am sure real states like Texas would be more than happy to have them.

Or Virginia.

6 posted on 03/25/2010 6:20:45 AM PDT by ScottinVA (RIP to the country I love...)
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To: LFOD
Your gov must have been bright enough to know that any new taxes would hurt business in an already tax-heavy state. Nobody is that stupid, right?

Oh, no. Certainly not.

7 posted on 03/25/2010 6:22:36 AM PDT by ScottinVA (RIP to the country I love...)
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To: pnh102

“They’re beating up on the guys doing the best to create jobs,” said Tom Taylor, chairman of the Massachusetts Medical Devices Industry Council and founder of Roush Life Sciences.

Can someone look up to see if this guy donated money to the dems or obama?


8 posted on 03/25/2010 6:23:59 AM PDT by Walkingfeather
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To: ScottinVA
Too bad they’d have to move overseas. I am sure real states like Texas would be more than happy to have them.

It's a national tax. Texas will have to secede first.

9 posted on 03/25/2010 6:25:53 AM PDT by AU72
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To: pnh102

I suspect once they bite the bullet and move, they might as well go all in and go to Singapore. Massachusetts used to be a manufacturing Mecca, from about 1800 to 1980. Industries have been dying, electronics was one of the last to disappear, with medical devices one of the few healthy sectors. It looks like that’ll be gone soon, too. In a generation or too, all we’ll have left is finance, education and tourism. But what to finance, education for what and who’ll have money to come as tourists? Other than the Chinese.


10 posted on 03/25/2010 6:26:50 AM PDT by Lonesome in Massachussets (The naked casuistry of the high priests of Warmism would make a Jesuit blush.)
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To: AU72
"Under the legislation signed by Obama, medical-device companies would be slapped with a sales tax of about 2.9 percent..."

And that was supposed to lower medical costs? Democrats need to be voted out!

11 posted on 03/25/2010 6:28:50 AM PDT by avacado
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To: pnh102
Too bad they’d have to move overseas.

I'm not thrilled about a federal sales tax; what's next ?

Driving medical device manufacturers overseas is a really, really bad idea and I'm not talking about the loss of jobs either.

If more people knew what I know...

12 posted on 03/25/2010 6:29:36 AM PDT by NativeSon
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To: AU72

I’m guessing the medical device manufacturers are probably big donors to the Governor and other dems in the state?


13 posted on 03/25/2010 6:30:36 AM PDT by poindexter
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To: pnh102

Texas companies are not exempt from federal taxes
Besides, more jobs are comin’! Four million new jobs! 400,000 immediately! As per Nan Pelosi!

http://hotair.com/archives/2010/02/25/pelosi-its-not-a-health-care-reform-bill-its-a-jobs-bill/


14 posted on 03/25/2010 6:31:11 AM PDT by silverleaf (Karl Marx was NOT one of America's Founding Fathers)
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To: ScottinVA

People I know in the state Democrat party told me there’s a reason why Diane Patrick is so depressed.


15 posted on 03/25/2010 6:32:25 AM PDT by massgopguy (I owe everything to George Bailey)
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To: LFOD

As a percent of income, state and local tax burden in Massachusetts is about median for the nation and lower than most of the northeast. New Hampshire might have us beat. Barbara Anderson and Howie Carr have been invaluable in beating back the Dukakoids. In fact the preception of Taxachusetts plays into the hands of the anti-tax activists. Massachusetts once had relatively high taxes, but not so much anymore.

New York, New Jersey, Maryland, Connecticut and Rhode Island, to name a few, are all much worse. The business climate in Massachusetts is probably a lot better than in a lot of other states. Losing DEC, Polaroid and a host of smaller companies and entire industries (shoes, textiles) in the lifetime of people below thirty has made people appreciate the importance of business. No politician in Massachusetts adopts the kind of antibusiness posture so common in other states.


16 posted on 03/25/2010 6:36:50 AM PDT by Lonesome in Massachussets (The naked casuistry of the high priests of Warmism would make a Jesuit blush.)
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To: AU72
“This bill is a jobs killer,”

Well duh! We're gonna be hearing a chorus of "OMG, I didn't know.." as the realization that these pigheaded morons backed a monstrous mistake of historic proportions starts to sink in.

“This bill is an America killer”
17 posted on 03/25/2010 6:38:52 AM PDT by rockrr (Everything is different now...)
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To: AU72
It's all good.

The plan has nothing to do with health care.

It's sole purpose is to overwhelm the system.

18 posted on 03/25/2010 6:41:30 AM PDT by E. Pluribus Unum (Islam is a religion of peace, and Muslims reserve the right to kill anyone who says otherwise.)
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To: pnh102

Wrong, under the rules of the Constitution, the only place they will be able to sell their products as tax exempt, if they move to Texas, is within Texas. Otherwise they will pay the tax based on a Federal levy, enforced by the IRS.

They will have to move out of the USA. Mexico perhaps?


19 posted on 03/25/2010 6:42:10 AM PDT by PSYCHO-FREEP ( Give me Liberty, or give me an M-24A2!)
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To: AU72

“He ticked off his past support for the life-sciences industry. But he added that “you better believe I will work to make modifications” if the bill is found to be an “impediment to that industry.” “
Yah, sure. Too late a$$hole.


20 posted on 03/25/2010 6:44:32 AM PDT by Scotsman will be Free (11C - Indirect fire, infantry - High angle hell - We will bring you, FIRE)
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To: NativeSon
Driving medical device manufacturers overseas is a really, really bad idea and I'm not talking about the loss of jobs either.

Good old ChiComo Quality Control....

21 posted on 03/25/2010 6:44:53 AM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: NativeSon

So what do you know?


22 posted on 03/25/2010 6:45:52 AM PDT by Scotsman will be Free (11C - Indirect fire, infantry - High angle hell - We will bring you, FIRE)
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To: AU72
Despite his concerns, Patrick stood by health care reform yesterday, saying the law is “very good for the people of America and the people of the commonwealth.”

Nothing more needs to be said.

Every manufacturer in Massachusetts affected by this tax should pack up and move -- if not overseas, then at least to a state where the governor and/or attorney general have taken it upon themselves to file a suit in Federal court against ObamaCare.

23 posted on 03/25/2010 6:49:26 AM PDT by Alberta's Child ("Let the Eastern bastards freeze in the dark.")
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To: Lonesome in Massachussets
As a percent of income, state and local tax burden in Massachusetts is about median for the nation and lower than most of the northeast. New Hampshire might have us beat.

Might?

Well, the Democrats are doing their best to close that gap, anyway.

24 posted on 03/25/2010 6:53:08 AM PDT by mvpel (Michael Pelletier)
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To: mvpel

nobama, patrick, fenty and so on...birds of a feather...feckless birds


25 posted on 03/25/2010 6:58:57 AM PDT by hal ogen ($10 (I think) ajmo0unts through the internet from all over the world.)
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To: AU72


“This bill is a jobs killer,” said Ernie Whiton, chief financial officer
of Chelmsford’s Zoll Medical Corp.,...

I don’t know if it is the same person, but there was an officer from
Zoll Medical that appeared on FOX making reasonable complaints about
the Obamacare bill.

(It may have been on Cavuto on FNC a couple of days ago.)


26 posted on 03/25/2010 7:12:38 AM PDT by VOA
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To: NativeSon
If more people knew what I know...

Why don't you tell us.......

27 posted on 03/25/2010 7:18:24 AM PDT by Osage Orange (A fear of weapons is a sign of retarded sexual and emotional maturity. - Sigmund Freud)
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To: AU72
He's talking about MA not allowing them to pass it on to their customers.

Presumably Texas would allow them to do that.

28 posted on 03/25/2010 7:40:00 AM PDT by Siena Dreaming
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To: Osage Orange; Scotsman will be Free

I will discuss later when I am out of the office.


29 posted on 03/25/2010 8:22:34 AM PDT by NativeSon
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To: E. Pluribus Unum

TWP: Thread Winning Post!


30 posted on 03/25/2010 8:26:20 AM PDT by piytar (Ammo is hard to find! Bought some lately? Please share where at www.ammo-finder.com)
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To: AU72

“...if we can’t pass along these costs to our customers,”

But, but Obama said only those making over $250,000.00 a year will pay the tax!


31 posted on 03/25/2010 8:40:29 AM PDT by Ruy Dias de Bivar (Obama's vision for America...Green shoots and skittles, where pancakes grow on fritter trees.)
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To: NativeSon

I’m pretty sure I know what you know, and maybe more about the specific medical industries being discussed here since I work for one of the companies based in MA). This is already causing massive layoffs at our company!


32 posted on 03/25/2010 8:41:53 AM PDT by jurroppi1 (America, do not commit Barry Care-y!)
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To: Walkingfeather

Just because you pay off the mafia doesn’t mean you like the mafia.


33 posted on 03/25/2010 8:45:36 AM PDT by allmendream (Income is EARNED not distributed. So how could it be re-distributed?)
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To: massgopguy

That’s actually very likely true from what I hear in political circles. Let’s just say Patrick might be good friends with Frank.


34 posted on 03/25/2010 7:36:55 PM PDT by AKSurprise ("All that is necessary for the triumph of evil is that good men do nothing." - Edmund Burke)
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