Olympus Owes $6.6 Million in Tax for Medical Device Repair Parts

Olympus America Inc. is stuck with a $6.6 million in use tax bill because it incorporated repair parts into medical devices in California, despite those products ultimately being shipped out of state and used there, a state court held.

The repair parts for Olympus’ endoscope and endotherapy devices don’t fall under a tax exemption for items used outside the state because they were applied within a San Jose service center, pursuant to Olympus clients’ lump-sum contracts covering all repairs, the California Superior Court, San Francisco said.

• The exemption only applies to products that are simply in transit or held in ...