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Medical Device Tax Repeal Vote Sought by GOP (Video)

Hatch, above, Burr and Coburn released new health care legislation. (Bill Clark/CQ Roll Call File Photo)
Hatch, above, Burr and Coburn released new health care legislation. (Bill Clark/CQ Roll Call File Photo)

Republicans are eager to attach a repeal of a medical device surtax to the tax cut extension package on the Senate floor, but the chamber’s top Democrat seems to have no appetite for it.  

The disagreement only increases the likelihood that the broader $85 billion tax extenders bill will join a long list of measures having trouble getting off the Senate floor. The larger bill would revive a package of more than 50 tax breaks that have expired.  

“For some reason they don’t want to have that vote,” said Finance ranking member Orrin G. Hatch, R-Utah, referring to the Democratic position on rolling back the 2.3 percent medical device tax. “A lot of companies are leaving America to go overseas.” Majority Leader Harry Reid, D-Nev., has long supported the tax, even in the face of opposition from a number of members of his caucus. When Republicans floated its repeal as a possible sweetener last September on a stopgap spending bill that could have averted the eventual government shutdown, Democrats did not bite .  

Hatch said he heard from some Democrats that Reid was likely to block consideration of a device amendment.  

“I’m not going to cry any big tears over the device folks,” Reid told reporters. “Their profits were huge last year. Remember, there was one deal, I think it was a $15 billion deal, where they were consolidated, a merger,” Reid said Tuesday. “So, the device tax folks are doing extremely well. They’re doing extremely well with Obamacare. Their profits have gone up significantly since Obamacare.”  

Hatch highlighted the fact that the excise tax established by the 2010 health care overhaul law applies on gross, rather than net income.  

“They get socked with a 2.3 percent gross tax on gross income,” Hatch said of the manufacturers. “I mean it doesn’t take … much of a brain to realize that’s stupid!”  

Sen. John Barrasso discussed the tax both at a Republican leadership media availability and again shortly thereafter with a smaller group of reporters.  

“The Democrats will have an opportunity this week on the floor of the Senate to deal with jobs, the economy and the devastating side effects of the health care law,” the Wyoming Republican said. “I think it’s time to actually take a look at the medical device tax and truly putting forth, in a vote, an opportunity to eliminate the medical device tax.”  

While Minority Leader Mitch McConnell would not speculate on how his members might vote, the prospects for the underlying tax cut bill passing the Senate without amendments seemed dubious.  

“The bill does enjoy support. It is always our hope to have amendments,” the Kentucky Republican said, adding that he would not prognosticate about what might happen if Reid blocks amendments.  

Sen. Patrick J. Toomey, R-Pa., expressed interest in offering the medical device rollback amendment, and McConnell also referred to the measure Tuesday.  

“As others have indicated, so many senators have said that they were in favor of … repealing it on a sense of the Senate resolution, why not have that vote when it really counts,” McConnell said.  

“It was interesting last year when we had the nonbinding vote that 34 Democrats said they wanted remove the medical device tax because they realize it’s hurting the economy, hurting jobs, hurting innovation, hurting research and development and actually driving jobs overseas,” Barrasso said. “But when it comes to count the vote, when it really matters, they say … I don’t think I want to take that vote.”  

That nonbinding vote, which took place when the Senate was debating a budget resolution last year, would likely differ from a standalone legislative proposal, since it called for unspecified budget neutrality . A House-passed device tax repeal scored as costing about $29 billion over a decade.  

Sen. John Thune, R-S.D., said Democrats are running from taking real votes on legislation.  

“It’s like Keystone. If it’s symbolic and largely non-consequential they are willing [to hold] a vote and tell their constituents that they voted that way,” Thune said. “But when it really matters I think they will be running for tall grass when it comes to the medical device repeal.”  

Thune said he also plans to file an amendment that would repeal the individual mandate, which is part of the Affordable Care Act and requires individuals to buy health insurance.  

In addition to those two amendments, he said Republicans also would be very interested in voting on making permanent a provision that allows small businesses to get their entire depreciation deduction in one year, also known as Section 179 expensing.  

Thune added that he would also want to make permanent the deductibility of state and local sales tax as well as extend or make permanent the current Internet sales tax moratorium, which expires Nov. 1.

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