Senate bill proposes 12% doctor tax rate tied to Vital plan participation
Senate President Thomas Rivera Schatz introduced Senate Bill 1570 to amend Puerto Rico’s Incentives Code, reopening applications for physician tax incentives while requiring treatment of government health plan patients and hospital service.
PhotoThe short version
- News is my Business reports Senate Bill 1570 would set a 12% preferential income tax rate for 15 years on eligible medical services income with a possible 15-year extension
- The San Juan Daily Star reports the bill requires participating doctors to treat Plan Vital patients and annually certify hospital or primary health center practice requirements such as five weekly in-person consultations
- Both outlets state the measure eliminates the existing 180-hour annual community service requirement and ties eligibility to Health Department-identified medical shortages by specialty and region
- The bill would remove audiology, chiropractic and optometry from qualifying professions while adding "dental school faculty and public sector oral health" practitioners according to News is my Business
Bill aims to address physician migration
A bill introduced this week by Senate President Thomas Rivera Schatz would reopen applications for physician tax incentives in Puerto Rico at a 12% income tax rate. News is my Business reported Senate Bill 1570 would amend the Incentives Code, Act 60-2019, removing the June 30, 2022 application cutoff. Qualifying physicians would receive the preferential rate for 15 years on eligible medical services income, with a possible extension based on compliance and the island’s economic and social interests.
The San Juan Daily Star reported the measure seeks to address physician shortages that have led "to longer wait times for appointments and increased" pressure on medical offices and emergency rooms. Both outlets note the bill’s preamble states that physician migration has created gaps in the health care system, leaving many residents struggling to secure timely care.
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Requirements include Vital plan participation
Under the proposal, physicians would have to "to treat patients enrolled in the government s" Plan Vital health insurance program under a contractual arrangement. The San Juan Daily Star reported doctors must annually certify they meet practice requirements such as maintaining active hospital or primary health center privileges and "conducting at least five" "in person patient admissions or consultations per week".
News is my Business reported alternative requirements would cover hospital-based practices, contracted services and leadership or quality improvement positions. "The bill identifies emergency physicians radiologists anesthesiologists pathologists" hospitalists and intensivists among those covered by the alternatives. It would also remove the existing 180-hour annual community service obligation for current and new decree holders who switch to the 12% rate.
Shortage-based eligibility and fiscal conditions
Eligibility would depend on the Health Department identifying shortages in "a physician s specialty or area of practice" through regional assessments that consider physician numbers, waiting times, hospital services, external referrals and demand conditions. The department would produce a medical needs report for the Department of Economic Development and Commerce, the Treasury Department and the Legislature. News is my Business reported neither agency "could impose numerical caps on decrees by specialty" or region, and application windows would last at least 12 months.
The San Juan Daily Star reported the bill retains "an exemption for eligible dividend income of up to" $250,000 annually and allows cardiovascular surgeons to qualify under full-time service provisions at the Cardiovascular Center. Before issuing decrees, the Treasury Department, DDEC and the Fiscal Agency and Financial Advisory Authority must identify funding sources to offset effects on the General Fund, certify compliance with PROMESA and the certified fiscal plan, and report to the Legislature.
Where the sources differ
Both News is my Business and The San Juan Daily Star agree on the bill’s introduction by Senate President Thomas Rivera Schatz, the 12% tax rate replacing the prior 4%, the requirement to treat Plan Vital patients, elimination of the 180-hour community service rule, shortage-based eligibility determined by the Health Department, retention of the $250,000 dividend exemption, and the need for fiscal mitigation certification before issuing decrees. News is my Business provides more detail on the bill’s text regarding removal of certain professions from the qualifying list, addition of dental professionals, amendment options for existing decrees, and prior fiscal concerns with a separate bill. The San Juan Daily Star places greater emphasis on the preamble’s goals of retaining and attracting physicians and on the specific hospital certification and leadership roles required.
What the reports do not say
The reports do not state when the Senate might take up the bill, whether it has House support, the estimated fiscal impact on the General Fund, how many physicians might apply under the new terms, or the current number of active physician tax decrees. They also do not specify the exact date the bill was formally filed beyond “earlier this week” or provide the full text of the measure.
Sources
Every link below was opened and checked when this story was published. Official means a government body, agency or the organization itself; Reporting means a news outlet.
- Reporting Puerto Rico bill proposes 12% doctor tax rate, Vital plan participation
- Reporting Senate bill would tie tax incentives for doctors to Vital plan participation, hospital service
How we checked this
News is my Business and The San Juan Daily Star both covered the introduction of Senate Bill 1570 on Oct. 21, 2026. Details on practice requirements, shortage criteria, dental professionals and fiscal preconditions rest on both reports, while the exact list of covered hospital-based specialties and prior fiscal concerns with a separate bill appear only in News is my Business.
Compiled by the PuertoRico.com News Desk from the reports and statements listed above, and checked against them before publishing. It does not include original interviews. Spot an error? Email support@puertorico.com with a link to this story.