Not so fast: Utah’s Hatch thinks medtech levy repeal could be part of tax reform

Despite House Republicans’ insistence that any taxes associated with Obamacare – including the medical device tax – won’t be part of the negotiations over tax reform, Sen. Orrin Hatch (R-Utah) that the overall tax package could include the repeal of taxes put in place by the Affordable Care Act.

The 2.3% excise tax on U.S. medical device sales was enacted along with the ACA in 2010 and went into effect in 2013. A 2-year moratorium put in place in 2015 is slated to expire at the end of this year; proponents of repealing the tax were hopeful that the ACA repeal-and-replace legislation that failed last week would put a permanent nail in the levy’s coffin.

But the Republican healthcare reform plan went down in flames last week before it could come to a vote, with Rep. Kevin Brady (R-Texas), chairman of the House Ways & Means Committee, taking Obamacare taxes off the table for the tax reform push.

“We never envisioned bringing Obamacare taxes into that [tax reform] effort and I still don’t,” Brady said, noting that the ACA taxes “go away when we repeal and replace. And so regrettably, they stay in place.”

Hatch, chairman of the Senate Finance Committee, yesterday put the Obamacare tax repeal back on the table – either as part of the tax reform negotiations or a revised healthcare reform bid.

“Either, as far as I’m concerned,” Hatch said. “Any way we can get rid of those, I think it’d be a good thing.”

Material from Reuters was used in this report.

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