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  • 1.  medical devcie excise tax / USA

    Posted 05-Mar-2013 07:49

    Hello,

    Our company is a contract manufacture/OEM for company situated in USA. This company is a legal manufacture of the device and its name and address is stated on the labeling. In this case  which company is obliged to pay medical devcie excise tax? 
    I would very appreciate to receive more clear information regarding resposibilities  of foreign contract manufactures or OEMs concerning  medical excise taxes.


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    Zoya Lee
    RA
    Degania Silicone Ltd
    Israel
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  • 2.  RE:medical devcie excise tax / USA

    Posted 05-Mar-2013 16:12
    Zoya, 

    The IRS has posted some fairly helpful documents regarding the tax, which may be found here: (http://www.irs.gov/uac/Medical-Device-Excise-Tax:-Frequently-Asked-Questions)

    Question six, in particular, seems to address your question:

    "Q6. Who is the manufacturer for purposes of the medical device excise tax?

    A6. Generally, with regard to the medical device excise tax, the manufacturer is the person who produces a taxable medical device from scrap, salvage or junk material, or from new or raw material, by processing, manipulating or changing the form of a device or by combining or assembling two or more devices."

    By that reading, it would seem that even if you're a contract manufacturer, the tax may apply to you. However, I know medical device manufacturers had been fighting that interpretation in 2011 (see: here)

    The examples listed starting on page 47 of the tax regulation seem to indicate that contract manufacturers will be required to pay those taxes, but it depends largely on whether they manufacture a medical device, or just unfinished components.

    Hopefully this serves as a proper starting point for further research or a jumping-off point for someone more knowledgeable than I, as i'm not sure that I know the exact answer to your question.

    Best, 

    Alec



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    Alexander Gaffney
    - RAPS
    agaffney@raps.org
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    Original Message


  • 3.  RE:medical devcie excise tax / USA

    Posted 05-Mar-2013 17:06
    Alex and Zoya,

    The new Excise Tax is a US federal tax regime.  It is for US medical device manufacturers and importers.  I think Zoya, your company is outside of US IRS jurisdiction.  

    Do you consider you are a manufacturer or importer here in the US?  I guess not.  

    My friend CEO moved his company from MN to Ireland.

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    www.regulatorydoctor.com
    Riner VA
    United States
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    Original Message