Telemed now exempt from BPT, user tax
Updated: Aug 19, 2021
Gov. Lou Leon Guerrero today signed into law a bill exempting medical equipment and telemedicine technology from the business privilege and use taxes.
“Bill 7-36 incentivizes providers to participate in these programs by exempting the proceeds related to sales of medical equipment to such participating providers from the business privilege tax,” the governor said in signing the bill, now Public Law 36-45. “This legislation will serve to improve the quality of care for many or our most vulnerable residents by expanding access.”
The bill, authored by Sen. Tony Ada, noted that adding new medical services, clinics and hospitals require new investments in medical equipment and telemedicine technology and the business privilege and use taxes add to the cost of health business.
“Since major investments in new medical technology were not anticipated in the business privilege and use tax bases, there should be no erosion of the currently anticipated revenues of these taxes in the current or future tax years,” the bill states.
The governor said the Covid-19 pandemic highlighted the critical need for the community to gain access to quality healthcare is crucial.
“As our hospitals and clinics have worked to treat Covid-19 and so many other illnesses, we have relied on advanced medical technologies, including those used to facilitate telemedicine. The necessary equipment has proven critical to our efforts in combating Covid-19,” the governor said.
Ada said the new allow provides incentives for private clinics and hospitals to invest in medical equipment and telemedicine technology.
"The Covid pandemic and the resulting lockdown and travel restrictions have brought to the forefront our island's need for certain medical procedures and consultations currently not available on Guam," Ada said.
"Quite often, such medical equipment represents a sizable capital outlay for which BPT or use tax must be paid. The tax on a million-dollar piece of equipment was forty thousand dollars prior to the enactment of this law," he added.
Ada said the new law brings Guam a step closer to having medical procedures performed on the island and not have our people spend huge amounts of money for off-island treatment.
On Aug. 6, the Guam Memorial Hospital announced Authority announced that telemedicine has now become a staple feature in its intensive care unit.
GMH officials said the adoption of telemedicine became urgent when Guam was at the height of grappling with the second wave of Covid-19 infection last year.
"GMH had so many virus-stricken patients needing her specialization in lung care, the only way to make it happen was through technology," GMH said. "It became quickly apparent that telemedicine was an innovative tool, availing the most critical patients of specialized care around-the-clock."
Dr. Joleen M. Aguon, pulmonary & critical care physician and Covid medical director at GMH, said although the coronavirus remains a hard-fought battle, telemedicine is one of the few silver linings.
"This virus pushed us at GMH beyond our limits and beyond anything we thought was possible," she said. "Through this push, we broke barriers to medical care and found these incredible opportunities and talents that will forever improve our bedside care for our community.”