On the way: Sales tax relief

Monday, June 30, 2008

ATLANTA--Georgia in May joined the long list of states that have eliminated sales and use tax for durable medical equipment.

Beginning July 1, beneficiaries will no longer have to pay a 7% sales and use tax (4% state tax and 3% local tax) on DME like CPAPs.

“The sales tax was burdening beneficiaries,” said David Petsch, owner of Petsch Respiratory in Martinez, Ga. “They’re in financial difficulty and, in many cases, they can’t even pay their co-pays. Then you add a sales tax? It wasn’t right.”

Gov. Sonny Perdue signed a bill on May 14 that eliminates the sales and use tax for DME and prosthetic devices. The state’s House of Representatives passed the bill on March 11 and the Senate passed it on May 1. Rep. Larry O’Neal, R-146th district, and Sen. Greg Goggans, R-7th district, sponsored the bill.

Providers and others have been trying to exempt DME from the sales tax, in one form or another, since the mid-90s.

In addition to burdening beneficiaries, the tax put providers in a precarious position, Petsch said.

“We couldn’t collect it from beneficiaries who couldn’t pay their bills, and we couldn’t reimburse the state,” he said. “It was like chasing a rabbit we couldn’t catch.”

When lobbying legislators, providers pointed out that pharmacies and medications are exempt from the sales and use tax.

Reps. Jeanette Jamieson, R-28th district, and Butch Parrish, D-156th district, and Sen. Chip Rogers, R-21st district, were strong supporters of the bill, according to Teresa Tatum, executive director of the Georgia Association of Medical Equipment Services.