What is the Medical Device Tax?
Washington never has seen a tax it did not like, because it brings dollars from the population that Washington can spend in its rabid race to financial instability. A new tax of 2.3 percent called the Medical Excise tax went into effect Jan. 1, 2013. Since the tax became law, some retail businesses started collecting the 2.3 percent extra and listing it on their receipts as Medical Excise tax.
According to the IRS, “Generally, under the final regulations, a taxable medical device is a device that is listed as a device with the Food and Drug Administration (FDA) under section 510(j) of the Federal Food, Drug and Cosmetic Act, and 21 CFR part 807, pursuant to FDA requirements. If a device is not listed as a device with the FDA but the FDA determines that the device should have been listed as a device, the device will be deemed to be listed as a device with the FDA as of the date the FDA notifies the manufacturer or importer in writing that corrective action with respect to listing is required.”
Problems allegedly arose because businesses were told by the government to keep the tax secret from the public. Some refused and listed it on the second line below the usual sales tax line. Other problems arose because the government evidently was unprepared to receive the money and gave credit for payment, so these companies are offering to refund the tax collected when presented with the original sales slip.
The next time you buy a wheelchair or bedside potty chair, look for the 2.3 percent Medical Excise tax. Your health care cost just went up, but don’t worry. It will cost you nothing because the President said it won’t (also, it is “supposed to be a secret”).