Healthcare groups welcome proposed tax relief on doctors' overtime pay

Taipei, June 12 (CNA) Groups representing medical institutions and healthcare professionals support the government's efforts to address the shortage of medical staff at Taiwan's hospitals by cutting tax on doctors' overtime pay and called for further tax relief on Thursday.

Officials from the health, labor and finance ministries agreed to reduce income tax on attending physicians' overtime pay during a meeting Wednesday with associations representing hospitals and physicians, with five healthcare groups expressing their approval in a joint statement Thursday.

The five national groups also called for other tax arrangements to be introduced to help improve the income of healthcare workers who work longer hours and often in stressful environments, according to the statement.

The groups, including the Taiwan Medical Association, which represents physicians in the country, and the Taiwan Union of Nurses Association, said the government should extend the financial support provided to policemen, firefighters and military personnel in the form of income tax deductions to healthcare workers.

The two groups, along with the Taiwan Hospital Association, the Taiwan Nongovernmental Hospital and Clinics Association and the Taiwan College of Healthcare Executive explained the situation attending physicians face in Taiwan that have led to staff shortages in their joint statement.

A physician working at a hospital works 70-100 hours a week, they said, citing data compiled by the Directorate General of Budget, Accounting and Statistics.

In comparison, the Labor Standards Act sets a 40-hour workweek for private-sector workers in Taiwan, with maximum overtime capped at 54 hours per month.

Only resident doctors at private hospitals or those on certain contracts at public hospitals are protected under the labor law, while attending physicians have been excluded because of the autonomous nature and the very different types of practices of their profession, according to the Ministry of Labor.

The exclusion from the labor law also means attending physicians have to pay income tax at a higher rate because the overtime pay they receive is not deductible, while the Income Tax Act exempts overtime pay and some allowance laborers receive at work.

During Wednesday's meeting, government officials agreed to allow tax free overtime pay for up to half of total work hours for both attending physicians and resident doctors, whether they are protected by the labor law or not, National Health Insurance Administration Director General Shih Chung-liang (石崇良) told reporters afterwards.

Shih said the reduced tax on overtime pay could apply to income for this year and be claimed when filing income tax in May 2026, if the regulations required are put in place in time.

In Thursday's statement, the healthcare groups said allowances medical staff receive for working certain shifts should also be exempt from income tax, citing the United Kingdom and Germany as examples.

They also suggest higher allowance to attract new talent and retain medical staff in key areas including emergency services, anesthesiology and pediatrics.