ADIA is the peak business organisation representing manufacturers and suppliers of dental products. Our vision is for an industry that empowers oral health professionals to advance the health and wellbeing of all Australians...................... — ADIA Strategic Plan

Media Release —
New Medical Devices Tax Wipes
Out Small Business Tax Cut Benefit

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— 3 May 2018
For Immediate Release

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Proposals from the Australian Government to impose new cost imposts on suppliers of low-risk medical devices will eliminate the entire benefit of its tax cuts for many small businesses in Australia’s dental industry. This is the assessment of the Australian Dental Industry Association (ADIA), the peak business organisation representing manufacturers and suppliers of innovative dental products.

“ADIA has been a strong supporter of the Australian Government’s commitment to reduce tax rates for small business. It is therefore profoundly disappointing to know that. for many of these small businesses in the dental industry, the benefit of the small business tax cuts will be entirely eliminated by the new medical devices tax,” said Troy Williams, ADIA Chief Executive Officer.

The concerns of the dental industry surround a proposal of the Therapeutic Goods Administration (TGA) to impose on businesses a new impost to place low-risk medical devices on the Australian Register of Therapeutic Goods (ARTG). The ARTG is the list of medicines and medical devices that can be lawfully supplied in Australia. For the first time businesses will have to pay $530 for each new ARTG low-risk medical device entry.

“This may not seem like a large amount, but for many small businesses in Australia’s dental industry it’s huge cost. These businesses just want to do the right thing. They want to invest in their business. They want to pay their staff more – just like the Treasurer wants them to. However, the proposed medical devices tax just makes this harder,” Mr Williams said.

The proposed new tax on low-risk medical devices will apply on products such as speciality surgical instruments. It is estimated that for small businesses the cost will be between $4,240 and $13,250 per year, a large sum for the 80% of businesses in Australia’s dental industry that turnover less than $10 million per year.

“For many of these businesses the gains from the small business tax cut will be entirely wiped-out. That’s why ADIA is calling for the proposed introduction date of 1 July 2018 be delayed, allowing for the for the new tax to be subjected to formal review to assess its impact on small business,”
Mr Williams said.

Acknowledging the technical debate as to whether the TGA’s proposal constitutes a fee or a tax, ADIA suggests that the proposal needs to be looked at in its entirety.

“The increased funds that the TGA will be extracting from small businesses will be partially funding what any reasonable person would argue are the ordinary functions of government. These include public awareness campaigns, regulatory reform, departmental finance and audit activities plus enforcing sanctions and penalties. When business is being forced to pay for these functions, describing the revenues as a new tax is not without merit,” Mr Williams said.

Ends.

Photograph —

. Troy Williams - ADIA Chief Executive Officer [PDF]

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Media Contact —

ADIA Communications Officer
t: 1300 943 094.....e: media@adia.org.au

A — A D I A . .S T R A T E G I C . .A L L I A N C E S

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