Tuesday, May 21, 2019

Puerto Rico gov announces measures to keep doctors on the island

By on March 13, 2019

Include a reduced requirement for preferential tax rate, student-debt forgiveness program

(Courtesy)

SAN JUAN – In an attempt to retain and attract medical talent, Puerto Rico Gov. Ricardo Rosselló has sent a bill for the legislature’s consideration that would extend the deadline local doctors have to request a decree for preferential tax treatment until June 30.

At the news conference Wednesday in his office, La Fortaleza, the governor also announced he would include “a debt-forgiveness program” related to student loans in the soon-to-be-introduced incentives code legislation for doctors who commit to “serve the island” for the next seven years.

The Incentives for the Retention and Return of Medical Professionals Act allows the issuance of tax decrees under which doctors benefit from a preferential tax rate of 4 percent.

“On this occasion, we are extending the date of application for this tax decree for an additional period, so the greatest number of doctors can avail themselves of its benefits, to provide better health services to Puerto Ricans. We are also giving an additional incentive to attract talent that is not in Puerto Rico, in order to establish their practice here,” Rosselló Nevares said in a statement released by La Fortaleza.

“With this extension, we provide an alternative so those doctors who were not able to submit their decree request for…2018 in time, can benefit from the benefits of Act 14-2017,” he added.

The decree would help defray up to $65,000 in graduate student loan debt for doctors who earned their degrees either on the island or abroad. The program will be subject to requirements established by the Economic Development and Commerce Department (DDEC by its Spanish acronym).

To be eligible, doctors must meet the requirements pursuant to the U.S. Medical License Exam (USMLE) or must be studying some kind of medical specialty or pursuing their training residency. Were a physician who joined the program to leave the island before seven years have passed, unspecified noncompliance penalties would be imposed along with being required to pay off the student loan.

DDEC Secretary Manuel Laboy noted that since Act 14 in 2017, as of this month some 2,700 doctors file their returns at the preferential tax rate, “with the commitment of staying in the island for 15 years.”

“Now, with this new initiative, the Incentives Code will be provided through a regulation that will elaborate the parameters needed to promote a debt payment system for medical graduates to make a seven-year commitment to offer their services in Puerto Rico, retaining specialists that are difficult to recruit,” Laboy said. “With this action, we join other jurisdictions in the United States that are attractive to our medical talent that also offer these benefits.”

The governor said the benefits “apply to all,” but these will be considered during the legislative process and based on criteria such as the specialists that are needed most.

Health Secretary Rafael Rodríguez futher noted that the initiative is aimed at young medical residents that are interested in remaining in Puerto Rico to work once they have completed their studies. Officials estimate that 600 to 1,000 people a year could benefit from the medical student program.

The qualified medical student’s loan repayment project joins the “Cuentas Mi Futuro,” or “My Future Accounts” program, which will be included in the Incentives Code. It creates an educational development account of some $1,000 that will be established for children in kindergarten so they have some savings for their post-secondary studies.

House Bill 1635, introduced in May 2018, seeks to provide greater certainty to invest in Puerto Rico by establishing clearer regulations and more efficient processes to attract more capital.

 

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