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Jordan

Government and institution measures in response to COVID-19.

Government and institution measures in response to COVID-19.

Return to homepage  |  Last updated: 14 May, 2020

General Information

The Jordanian Government is taking the necessary steps to support the Private Sectors during the COVID-19 crisis and the precautionary actions taken to counter the spread of the virus in the country. Therefore, the Government of Jordan has activated the Defense Law No. (13) for the year 1992 on 18th March,2020 under which the Defense Order No. (1) for year 2020 and Order No. (5) in which certain measures were announced offering some relief measures on Social Security Contributions and other decisions that have impact in terms of Income tax as well as General Sales Tax in Jordan.

Tax measures – Direct and Indirect

(e.g. payment deferrals, rate reductions…)

Click here to see a comprehensive summary of jurisdictional tax measures and government reliefs in response to COVID-19.

Social Security measures

  • On March 19, 2020 the Jordanian Government issued the Defense Order No. 1 suspending some items of the 2014 Social Security Law and replacing them with the Order.
    • Under the Order, the Social Security Corporation has given the option to entities operating in the private sector to suspend payment of old-age Insurance in relation to private sector’s employees for a period of three months as of March 1, 2020 and apply a reduced the social security subscription ratio for entities and its employees from 21.75 % (14.25 % employer’s contribution in addition to 7.5% deducted from the employee on a monthly basis) to 5.25 % (4.25% as employer’s contribution in addition to 1% deducted from the employee). 
    • Under the Order, if the employer would not opt to apply the reduction above, the employer is able to settle the Social Security amounts due in relation to the period mentioned above (i.e., from 1 March until 31 May) over a period extending up to end of the year 2023 with no interest. 
    • The reduction shall not be applied on employees working in the Public Sector such as  “Amman Great Municipality” and other Municipalities in addition to government owned companies and public institutions.
    • Finally and as per the Order , no interest or penalties will be imposed on the amounts of Social Security liability due to the Social Security Corporation during the period from March 1, 2020 up to May 31, 2020, if such liability amounts were a result of; a delay in paying a Monthly Contribution, or a delay in submitting the requested forms, or a delay in reporting to the Social Security Corporation any changes to insurance recipients’ eligibility and pension eligibility.

Contact us

Tax Partner: Amin Husein – ahusein@Kpmg.Com
Tax Director: Khaled Tuffaha – ktuffaha@Kpmg.Com