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White House threatens veto on Paulsen med tax repeal

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  • June 6, 2012 - 4:21 PM
The White House has threatened to veto a bill sponsored by Minnesota Republican Erik Paulsen that would repeal a new tax on medical device makers like Medtronic and other state medical technology companies.
 
Wednesday’s veto threat comes on the eve of expected House passage of the bill, which would be a signal legislative achievement for the two-term congressman, who has positioned himself as a champion for an industry that provides about 35,000 jobs in the state.
 
The 2.3 percent levy on sales is scheduled to start in January to help finance Obama’s health care overhaul, including the expansion of coverage to more than 30 million people who currently have no insurance.
 
The tax repeal effort has the support of Sens. Amy Klobuchar and Al Franken, along with other Democrats in states with large medical-technology sectors. But to pay for the repeal, House Republicans would curtail tax credit subsidies designed to help low- and middle-income people buy coverage on new government-sponsored insurance exchanges, striking at the heart of the new health care law.
 
Klobuchar and Franken have said nothing so far about the new GOP proposal. But the White House veto threat would appear to diminish the already slim chances Paulsen’s bill had in the Senate, even if Democratic leaders there brought it up for a vote.
 
Paulsen vowed to press on. “American leadership in medical device innovation, and the nearly half million U.S. jobs it supports, is worth fighting for,” he said. “With the backing of more than 240 of my colleagues from both sides of the aisle, I look forward to bringing this bill to the House floor tomorrow to do the right thing and stop this ill-conceived and wrong-headed tax in its tracks.”
 
A spokesman for Senate Majority Leader Harry Reid of Nevada said no decision has been made about whether to act on the House bill. Inaction in the Senate would provide both Klobuchar and Franken a free-fire zone to support the repeal of a tax that hurts an important industry in their state, without having to make the Hobbesian choice between that and increasing the number of uninsured Americans.
 
A statement on the bill by the White House Office of Management and Budget said it “would fund tax breaks for industry by raising taxes on middle-class and low-income families... [and]...refight old political battles over health care.”
 
“If the President were presented with [the bill],” the statement continued, “his senior advisors would recommend that he veto the bill.”

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