ATR today released a coalition letter signed by 70 groups and activists in opposition to the Pelosi drug pricing proposal to create a 95 percent tax on pharmaceutical manufacturers.
As noted in the letter, this bill calls for a retroactive tax on sales that is imposed in addition to existing against income taxes:
Under Speaker Pelosi’s plan, pharmaceutical manufacturers would face a retroactive tax of up to 95 percent on the total sales of a drug (not net profits). This means that a manufacturer selling a medicine for $100 will owe $95 in tax for every product sold with no allowance for the costs incurred.
The tax is used to enforce price controls on medicines that will crush innovation and distort the existing supply chain as the signers note:
“The alternative to paying this tax is for the companies to submit to strict government price controls on the medicines they produce. While the Pelosi bill claims this is “negotiation,” the plan is more akin to theft.”
This proposal will create significant harm to American innovation to the detriment of jobs, wages, and patients, as the letter notes:
”[The Pelosi] proposal would crush the pharmaceutical industry, deter innovation, and dramatically reduce the ability of patients to access life-saving medicines.
The full letter is found here and is below:
Dear Members of Congress:
We write in opposition to the prescription drug pricing bill offered by House Speaker Nancy Pelosi that would impose an excise tax of up to a 95 percent on hundreds of prescription medicines.
In addition to this new tax, the bill imposes new government price controls that would decimate innovation and distort supply, leading to the same lack of access to the newest and best drugs for patients in other countries that impose these price controls.
Under Speaker Pelosi’s plan, pharmaceutical manufacturers would face a retroactive tax of up to 95 percent on the total sales of a drug (not net profits). This means that a manufacturer selling a medicine for $100 will owe $95 in tax for every product sold with no allowance for the costs incurred. No deductions would be allowed, and it would be imposed on manufacturers in addition to federal and state income taxes they must pay.
The alternative to paying this tax is for the companies to submit to strict government price controls on the medicines they produce. While the Pelosi bill claims this is “negotiation,” the plan is more akin to theft.
If this tax hike plan were signed into law, it would cripple the ability of manufacturers to operate and develop new medicines.
It is clear that the Pelosi plan does not represent a good faith attempt to lower drug prices. Rather, it is a proposal that would crush the pharmaceutical industry, deter innovation, and dramatically reduce the ability of patients to access life-saving medicines.
We urge you to oppose the Pelosi plan that would impose price controls and a 95 percent medicine tax on the companies that develop and produce these medicines.
President, Americans For Tax Reform
James L. Martin
Founder/Chairman, 60 Plus Association
Saulius “Saul” Anuzis
President, 60 Plus Association
Chair, Alabama Center Right Coalition
President, AMAC Action
President, American Business Defense Council
President, American Commitment
Executive Director, American Conservative Union
President/CEO, The American Consumer Institute Center for Citizen Research
Lisa B. Nelson
CEO, American Legislative Exchange Council
Vice President of Policy, ALEC Action
President, Americans for a Balanced Budget
President, Americans for a Strong Economy
President, Campaign for Liberty
President, Center for a Free Economy
Andrew F. Quinlan
President, Center for Freedom & Prosperity
President, Center for Individual Freedom
Executive Director, Center for Innovation and Free Enterprise
Peter J. Pitts
President, Center for Medicine in the Public Interest
Senior Fellow, Center for Worker Freedom
President, Citizen Outreach
President, Club for Growth
President, The Committee for Justice
Vice President, Competitive Enterprise Institute
Executive Director, Conservatives for Property Rights
President, Consumer Action for a Strong Economy
Fred Cyrus Roeder
Managing Director, Consumer Choice Center
President, Council for Citizens Against Government Waste
Executive Director, Digital Liberty
Co-Chair, Florida Center Right Coalition
President, Frontiers of Freedom
President, Galen Institute
Director of Healthcare Policy, Goldwater Institute
The Honorable Frank Lasee
President, The Heartland Institute
Vice President, Heritage Action for America
Rodolfo E. Milani
Trustee, Hispanic American Center for Economic Research
Founder, Miami Freedom Forum
Mario H. Lopez
President, Hispanic Leadership Fund
President, Independent Women’s Forum
Heather R. Higgins
CEO, Independent Women’s Voice
Resident Scholar, Institute for Policy Innovation
President, Iowans for Tax Relief
Vice President of Policy, The James Madison Institute
The Honorable Paul R LePage
Governor of Maine 2011-2019
President, Less Government
Director, Lone Star Policy Institute
Chair, Maine Center Right Coalition
CEO, The Maine Heritage Policy Center
President, Maine State Chapter – Parents Involved in Education
President, Market Institute
Jameson Taylor, Ph.D.
Vice President for Policy, Mississippi Center for Public Policy
The Honorable Tim Jones
Leader, Missouri Center-Right Coalition
CEO, Montana Policy Institute
President, National Taxpayers Union
The Honorable Bill O’Brien
The Honorable Stephen Stepanek
Co-chairs, New Hampshire Center Right Coalition
The Honorable Beth A. O’Connor
Maine House of Representatives
The Honorable Niraj J. Antani
Ohio State Representative
Executive Director, Ohioans for Tax Reform
Honorable Jeff Kropf
Executive Director, Oregon Capitol Watch Foundation
CEO, Pelican Institute for Public Policy
Executive Director, Property Rights Alliance
President, Rio Grande Foundation
James L. Setterlund
Executive Director, Shareholder Advocacy Forum
President and CEO, Small Business Entrepreneurship Council
David Miller & Brian Shrive
Chairs, Southwest Ohio Center-right Coalition
Executive Director, Taxpayers Protection Alliance
President, Tea Party Nation
Director, Right on Healthcare – Texas Public Policy Foundation
President, Trade Alliance to Promote Prosperity
Executive Director, Wyoming Liberty Group
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