COVID-19 in Indonesia: Relaxation of BPJS of Employment Contributions

In accordance with a new government regulation namely PP 49 of 2020 that has been signed by President Joko Widodo on 31 August 2020, the contribution for BPJS of Employment in Indonesia has been relaxed. The purpose of this relaxation is to help ease the burden of the participants who have to deal and cope with the COVID-19 crisis in Indonesia.

This article discusses some important points that you need to know about the relaxation of BPJS of Employment contribution that is planned to be implemented from August 2020 until January 2021.

BPJS of Employment in Indonesia Relaxation in the Time of COVID-19

The following adjustments have been made in accordance with PP 49 of 2020:

1. 99% discount for Jaminan Kecelakaan Kerja (JKK) and Jaminan Kematian (JKM) contributions

The government has granted 99% discount for the above-mentioned contributions every month, with the scheme as follows:

• Very low risk: 0.24% to 0.0024%
• Low risk: 0.54% to 0.0054%
• Moderate risk: 0.89% to 0.0089%
• High risk: 1.27% to 0.0127%
• Very high risk: 1.74% to 0.0174%

2. JKK for construction companies in cases where the basic salary is unknown. The calculation for JKK, therefore, is based on the contract value within the term

• Contract value up to IDR 100,000,000: from 0.2% to 0.0020%
• Contract value above IDR 100,000,000 up to IDR 500,000,000: from 0.17% to 0.0017%
• Contract value above IDR 500,000,000 up to IDR 1,000,000,000: from 0.13% to 0.0013%
• Contract value above IDR 1,000,000,000 up to IDR 5,000,000,000: from 0.11% to 0.0011%
• Contract value above IDR 5,000,000,000: from 0.09% to 0.0009%

3. JKM for construction companies in cases where the basic salary is unknown. The calculation for JKM, therefore, is based on the contract value within the term

• Contract value up to IDR 100,000,000: from 0.03% to 0.0003%
• Contract value above IDR 100,000,000 up to IDR 500,000,000: from 0.02% to 0.0002%
• Contract value above IDR 500,000,000 up to IDR 1,000,000,000: from 0.02% to 0.0002%
• Contract value above IDR 1,000,000,000 up to IDR 5,000,000,000: from 0.01% to 0.0001%
• Contract value above IDR 5,000,000,000: from 0.01% to 0.0001%

4. Other adjustments that are covered

• Employees and employers will get the relief if the July contributions have been settled
• Employees that registered just after July 2020 must pay for 2-month contribution based on the normal rate
• Employees and non-employees will get the relief starting from the third month of the participation in the BPJS social security program
• There is no need to submit an application as the relief is provided directly by the BPJS
• If employers, employees and non-employees have paid for the JKK and JKM contributions in August 2020 or the following month and an excess is found, the excess will be compensated for the following month’s contribution
• Postponement of JP contribution for employers for the stated period: from 2% to 0.02%
• Postponement of JP contribution for employees for the stated period: from 1% to 0.01%
• Companies that want to postpone the payment for JP contribution need to submit an application to the BPJS office
• Fine for late payment: from 2% to 0.50%

To read the complete regulation, download from our e-library.

Consult with Cekindo

In the difficult time of COVID-19 in Indonesia, regulations may change from time to time, particularly regulations that are related to payroll, taxation and visas. It may be challenging and overwhelming to keep updated with the latest regulations.

As a leading consulting and outsourcing company in Indonesia, Cekindo has a team of experts that always update themselves with the newest implemented regulations to ensure 100% compliance at all times. We can provide you with the guidance you need and assist you in your payroll and taxation, among others.

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