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Markey seeks repeal of medical device tax

Manufacturers say 2.3% fee causes cuts in research, jobs

Senator Edward J. Markey, Democrat of Massachusetts, introduced legislation Tuesday to repeal the 2.3 percent excise tax on medical devices, a two-year-old levy that has been the target of a national industry with a strong presence in the state.

Markey’s bill, which currently has no co-sponsors, is the second in the Senate to seek repeal of the contentious tax, which was part of the health care overhaul passed in 2010 but didn’t take effect until 2013.

A separate bill previously filed by Senator Orrin Hatch, Republican of Utah, has 34 co-sponsors, including several Democratic senators. There are also three bills filed in the House of Representatives that would either repeal the tax or exempt certain medical devices.


Unlike the Hatch bill, Markey’s legislation is “revenue neutral,” calling for an end to tax incentives for oil and gas drilling and other steps to make up the revenue that would be lost from repealing the device tax.

“This is one way we could raise the revenue to offset the revenue that would be lost,” Markey said Tuesday. “But I’m open to other steps.”

The medical device industry, which employs nearly 24,000 in Massachusetts, has complained that the tax has led to cuts in research and development, cost jobs, and hurt innovation.

Markey said the excise tax has had “a chilling effect” on medical device makers. Repealing it “ensures continued investment in an industry that’s at the heart of the Massachusetts innovation economy,” he said.

Several efforts to repeal the tax in the past several years have failed.

Robert Weisman can be reached at robert.weisman@globe.com.