Thursday, July 4, 2013

Follow-up (MDET)

The June 1st, 2013 Blog entry 'Consequences (MDET)' looked at medical device manufacturers and how some have responded to the medical device excise tax provision of the Affordable Care Act... A recent article 'Is 3M Being Audited By the IRS For Its Medical Device Tax Payments?' discusses if the IRS is auditing the payments. 

In the article a "tax manager" at a company "technology and biosciences practice" is quoted as saying: "... Determining who is responsible for paying the tax is very confusing and has caused a great deal of dialogue between medical device companies and their customers..." Umm, no, not at all - it's clearly the medical device company that is required to remit the tax to the IRS. 

While he is right about the complexity and confusion, it's hard to understand why national and multinational device makers are "confused" enough to believe that their customers have liability for the tax payment, when the latter apparently are sophisticated enough to understand how this is supposed to work!

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