ABOUT 700,000 enterprises will save 20 billion yuan (US$2.86 billion) in social insurance premiums for their employees as the city government rolls out a favorable policy that temporarily reduces social insurance payments amid Shenzhen’s COVID-19 prevention and control efforts, Shenzhen Evening News reported Saturday.

According to an elaboration on the policy by the city’s human resources and social security bureau and the city’s finance bureau Friday, all enterprises that have participated in the city’s social security insurance program are eligible to have their social insurance payments exempted or reduced.

Small-, medium- and micro-sized enterprises will be exempted from paying premiums for basic pension, local supplemental pension, unemployment and work injury between February and June. Large enterprises will be exempted from paying for local supplemental pension between February and April.

The premiums for basic pension, unemployment and work injury paid by large enterprises will be reduced by 50 percent between February and April.

The corporate social insurance premium reduction policy also applies to individually owned businesses covered by the social security program as a unit and various social organizations. The policy, however, is not applicable to individual payments to the social security program, government agencies and public institutions.

The human resources and social security bureau said in the elaboration that the corporate social insurance premium reduction policy has been aimed at helping small-, medium- and micro-sized enterprises, which as a sector have contributed greatly to Shenzhen’s economic development, get through the difficult COVID-19 outbreak period.

Official statistics showed that small-, medium- and micro-sized enterprises take up more than 99 percent of the city’s total business entities and provide a substantial portion of employment opportunities to the city’s job market. However, these enterprises are more vulnerable to the effects of the epidemic outbreak than large corporations and State-owned enterprises.

The social security bureau said as the business operations of small-, medium- and micro-sized enterprises have been seriously affected by the epidemic, reducing the financial burden to pay social insurance premiums will hopefully help their business operations get back on track.

All social-security-program-participating enterprises will be categorized by the bureau to determine their eligibility, reductions or exemption. Eligible enterprises will automatically have their premium payments reduced without submitting an application. Employers who have an objection to their corporate categorization can submit materials stating the industry the company engages in, income, total assets and the actual number of its employees in December 2019 to the social security bureau before the end of this month. The proportion of the reduction and exemption of their social insurance premium will be determined after official verification, according to the elaboration.

The social security bureau said the city’s pension payments, unemployment and work injury insurance benefits won’t be affected by the social insurance premium reduction policy.

Separately, the city’s taxation authority has approved applications from 2,761 taxpayers to delay tax payments, totaling 1.662 billion yuan, as of Friday since the local taxation authority adopted a deferred tax payments and tax deduction policy for the city’s taxpayers.

Enterprises in Shenzhen have also been exempted from real estate tax and urban land use tax from January to March. The estimated tax deduction reached 1.5 billion yuan, benefiting 45,300 taxpayers.

The deferred tax payments and tax deduction policy has been effective in lowering the operational burden of the city’s enterprises, especially small- and medium-sized enterprises, and helps them resume work and production in response to the COVID-19 outbreak, said the tax authority.

(Wei Jie)