Taipei: Groups representing medical institutions and healthcare professionals are showing strong support for the government’s initiative to address the shortage of medical staff in Taiwan’s hospitals by proposing a tax reduction on doctors’ overtime pay. They urged for additional tax relief measures on Thursday to further tackle this issue.

According to Focus Taiwan, officials from the health, labor, and finance ministries reached an agreement to reduce income tax on attending physicians’ overtime pay during a meeting on Wednesday. This decision was welcomed by five healthcare groups, which expressed their approval in a joint statement on Thursday.

The five national groups also advocated for the introduction of other tax arrangements to enhance the income of healthcare workers who endure longer working hours and often challenging environments. The groups, including the Taiwan Medical Association and the Taiwan Union of Nurses Association, emphasized the need for financial support similar to that provided to policemen, firefighters, and military personnel through income tax deductions.

In their joint statement, the Taiwan Medical Association, Taiwan Union of Nurses Association, Taiwan Hospital Association, Taiwan Nongovernmental Hospital and Clinics Association, and Taiwan College of Healthcare Executive highlighted the challenging conditions faced by attending physicians in Taiwan, which contribute to staff shortages. They noted that a physician working at a hospital typically works 70-100 hours a week, based on data from the Directorate General of Budget, Accounting and Statistics.

The Labor Standards Act in Taiwan mandates a 40-hour workweek for private-sector workers, with a maximum of 54 hours of overtime per month. However, only resident doctors at private hospitals or those on specific contracts at public hospitals are protected under the labor law. Attending physicians are excluded from these protections due to the autonomous nature of their practice, according to the Ministry of Labor.

This exclusion means that attending physicians have to pay income tax at a higher rate, as their overtime pay is not deductible. In contrast, the Income Tax Act exempts overtime pay and certain allowances received by laborers. During Wednesday’s meeting, government officials agreed to permit tax-free overtime pay for up to half of the total work hours for both attending physicians and resident doctors, whether they fall under labor law protection or not, as stated by National Health Insurance Administration Director General Shih Chung-liang.

Shih mentioned that the reduced tax on overtime pay could be applicable to income for this year and claimed during the income tax filing in May 2026, provided the necessary regulations are implemented in time. In Thursday’s statement, the healthcare groups also called for allowances received by medical staff for specific shifts to be exempt from income tax, citing the United Kingdom and Germany as examples. They further recommended higher allowances to attract new talent and retain medical staff in critical areas such as emergency services, anesthesiology, and pediatrics.