Tuning up the Wisconsin job killer
December 13, 2012
We’re guessing relatively few who voted to re-elect Barack Obama can articulate a motivation that stands up to logical scrutiny. Those who reside in Wisconsin have a special reason to be ashamed.
A week ago today, the Internal Revenue Service finalized its rules for implementing a new tax that targets an industry significantly concentrated in Wisconsin and making products essential to the American quality of life.
It’s the new 2.3 percent tax on medical devices, supposedly to help finance the government health care takeover. That’s not 2.3 percent of profits, by the way; it’s 2.3 percent of gross sales. If a company has a very small profit margin, say 2 percent, the tax will confiscate its earnings and a little more. If a company is just breaking even and makes the mistake of selling any products, it’s immediately going in the red.
Many Wisconsin employers are in line for this Obamacare looting; an abundance of precision and high-tech manufacturing makes the state a target-rich environment. GE Medical Systems is an obvious example, but even a cursory, ten-minute search identified additional medical device manufacturers in Menomonie, De Forest, Waukesha, Clear lake, Chippewa Falls, Madison, Milwaukee, Menominee Falls, Grantsburg, Port Washington, Sussex, Clayton, Fort Atkinson, and Grafton.
Too often business pleads for “regulatory certainty” rather than challenge the premise of regulation. At least Mark Leahey, CEO of the Medical Device Manufacturer’s Association, doesn’t buy the “certainty” excuse, saying the finalized IRS rule “does nothing to prevent the loss of jobs and innovation that has already occurred as a result of the medical device tax, and will unfortunately continue if we do not repeal this bad policy.”
No repeal is in sight for a bad policy enabled, unwittingly, no doubt, by 52.8 percent of Wisconsin voters.