Medical Device Companies Breathe a Sigh of Relief: Excise Tax Delayed Two Years

On January 22, 2018, the President signed into law H.R. 195, which provides continued funding to the federal government through February 8, 2018. As part of this, Congress passed another two-year suspension of the medical device excise tax (“MDET”). The tax will now go into effect on January 1, 2020 (unless further repeal takes place).


On January 1, 2013, MDET became effective as a payment provision for the Patient Protection and Affordable Care Act. The 2.3% MDET was levied on the sale of medical devices that are fundamental to the practice of medicine both in diagnosing and treating disease. On December 18, 2015, Congress enacted the “Protecting Americans From Tax Hikes Act of 2015” (“PATH Act”) which imposed a moratorium on MDET beginning on January 1, 2016, and ending on December 31, 2017.

How we can help

At BNN we see this as positive news as it helps ensure that our clients are able to continue investing in the critical technologies that lead to innovation in patient care. Our life science professionals have experience working with medical device companies and can help you with MDET process review, tax minimization strategies, and other specialized services.

If you have any questions or would like to learn more about how this change may impact you, contact Bob Croak or a member of our life sciences practice.

Disclaimer of Liability: This publication is intended to provide general information to our clients and friends. It does not constitute accounting, tax, investment, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.

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