A budget amendment proposed today by U.S. Sen. Lamar Alexander (R-Tenn) would repeal a 2.3 percent federal tax on medical devices, potentially saving Tennessee manufacturers millions in future taxes stemming from the Affordable Care Act.
Medical devices ranked in 2012 as Tennessee's top export, as manufacturers shipped $2.1 billion in life-saving devices overseas. Tennessee ranked second only to California for medical device exports.
"This amendment is about ending two damaging tax policies that are costing Americans billions of dollars, and costing Tennesseans good jobs," Alexander said.
The 2.3 percent tax would add $40 million in costs to the state's exporters, a potential cost that has already caused Smith & Nephew, a manufacturer with a large presence in the state, to announce that it would lay off nearly 100 employees in both Tennessee and Massachusetts, according to a news release.
To pay for his proposal, Alexander called on Congress to also repeal a recently passed $12.1 billion tax credit that subsidizes the production of electricity through wind turbines. The ultimate goal of his amendment would be to repeal both tax provisions without increasing the federal debt.
Read more in tomorrow's Chattanooga Times Free Press.
Contact staff writer Ellis Smith at firstname.lastname@example.org or 423-757-6315.