BP Tapera Compliance: Key Provisions and Employer Obligations

Published on
May 31, 2024

The Government of Indonesia (“GoI”) has just enacted the Government Regulation (“GR”) No.21 of 2024 on the Amendment of Government Regulation No.25 of 2020 on the Organization of Public Housing Savings on 20 May 2024 and came into effect the day it was enacted (“GR 21/2024”). In this legal alert, the key provisions of GR 21/2024 will be examined, including on the eligibility and participant registration, amount of savings, allocation and contribution payment, termination of participation, and administrative sanctions for employers.

The general overview of the GR are as follows:

  1. Eligibility and Participant Registration

GR 21/2024 acknowledges 2 (two) types of participants, employee and independent employee (“Participants”).[1] The obligation to become the Participants of Public Housing Savings/Tabungan Perumahan Rakyat (“TAPERA”) applies only to those Participants who meet the minimum salary threshold, are at least 20 (twenty) years old or are married at the time of application.[2] However, for independent employee, participation in the program is not mandatory if they do not meet the minimum salary requirement.[3]

Furthermore, the GR specifies the types of employees as follow:[4]

  1. Candidates for Civil Servants/Calon Pegawai Negeri Sipil;
  2. State civil service employees/Pegawai Aparatur Sipil Negara;
  3. Indonesian National Army Soldier;
  4. Indonesian National Army Student Soldier
  5. Member of the National Police of the Republic of Indonesia State Officials;
  6. Employee/Laborers of State/Regional Owned Enterprises;
  7. Employee/Laborers of Village-Owned Enterprises;
  8. Employee/Laborers of Privately Owned Enterprises; and
  9. Employees who are not categorized as employees as intended in letters a to i who receive salaries or wages, which includes Organizing Body TAPERA (“BP TAPERA”), Bank Indonesia employees, Social Security Administering Agency Employees, and foreign nationals who have worked in Indonesia for a minimum of 6 months.

Regarding participant registration, employers are obliged to register their employee to the BP TAPERA.[5] Independent employees, on the other hand, must register themselves to the BP TAPERA.[6] Once the registration process is completed, Participants will be given an identification number which will become effective immediately upon issuance.[7]

  1. Savings, Allocation, and Contribution Payment

Employees’ savings contributions are shared between the employer and the employee, with the employer responsible for making the deposit. Whereas an independent employee’s savings is required to be paid by themselves.[8] For employees, the contribution is distributed with the employer paying 0.5% and the employee paying 2.5%, totaling 3% of the salary or wages.[9] For independent employees, the contribution amount is based on their average monthly income from the previous calendar year, subject to certain limit.[10]

In relation to the aforementioned, the Participants’ savings are divided into 3 (three) allocations, which are (1) Accumulation Funds/Dana Pemupukan, which savings will be used to be invested through Collective Investment Contracts/Kontrak Investasi Kolektif (KIK); (2) Utilization Funds/Dana Pemanfaatan, which savings will be used to fund the Participants’ housing; and (3) Reserve Funds/Dana Cadangan, which savings will be used to pay the Participants’ savings in the event of termination.[11]

With regard to the Utilization Funds, GR 21/2024 elaborates on 3 (three) types of funding, which range from house ownership, house construction, or house repairs.[12] However, to retrieve the funding on house, the Participants is required to fulfill several requirements, as follow:[13]

  1. Have a minimum participation period of 12 (twelve) months;
  2. Categorized as low-income groups;
  3. Do no have a house yet; and/or
  4. Use it to finance house ownership, first house construction, or first house improvements.

In terms of contribution payment, deposit on the Participant’s savings shall be conducted no later than the 10th of the following months of the relevant savings month into the TAPERA fund account.[14] Failure to make these deposits will result in the participant’s status becoming inactive.[15] Participation can be reactivated once the required deposits are made.[16] However, it is important to note that being categorized as inactive does not affect the amount of contributions previously paid to BP TAPERA.[17]

  1. Termination of Participation

The participation of TAPERA will be termination under the following circumstances:[18]

  1. Employee have retired;
  2. Have reached the age of 58 (fifty-eight) years old for independent employees;
  3. Participant passed away; or
  4. Participants no longer meet the criteria as participants for 5 (five) consecutive years. No longer meet the criteria as participants as in no longer have a salary, wage, or income for 5 (five) consecutive years, including due to total disability or due to proven termination of employment for 5 (five) consecutive years do not make savings deposits.

Termination of participation will invoke a refund of savings to the Participants along with its accumulation funds.[19] Such refund shall be returned at the latest of 3 (three) months after the participation is deemed as terminated.[20]

  1. Administrative Sanctions for Employers

Employer who does not comply with the obligation to register the employee (Article 8.1), deposit the savings to BP TAPERA (Article 20.1), conduct deposit at the latest of the 10th following months (Article 20.2) will be subjected to administrative sanctions which range from:

  1. Written warnings;
  2. Administrative fines;
  3. Publicize Employer non-compliance;
  4. Suspension of business permits; and/or
  5. Revocation of business license.
  1. Implementation

Currently, there are differing opinions on this matter, among others regarding the allocation of house location and the lack of exceptions, such as for individuals who already own a house, making it not mandatory for them because such matters are not mentioned in this GR 21/2024. Monitoring the implementation of this new regulation and other regulations that may be issued as a follow-up to this regulation is necessary. Please note that these provisions shall be applied at the latest of 7 (seven) years from the effective date of GR 21/2024 (20 May 2020).[21]

If you have any questions, please do reach out to us.

[1] Article 5.2 of GR 21/2024

[2] Article 5.3 and 5.5 of GR 21/2024

[3] Article 5.4 of GR 21/2024

[4] Article 7 of GR 21/2024

[5] Article 8.1 of GR 21/2024

[6] Article 8.2 of GR 21/2024

[7] Article 9.1 & Article 9.2 of GR 21/2024

[8] Article 14.1 & Article 14.2 of GR 21/2024

[9] Article 15.1, 15.2 & 20.2 of GR 21/2024

[10] Article 14.3.b of GR 21/2024

[11] Article 18.1, 18.3, 18.4, & 18.3 of GR 21/2024

[12] Article 36.2 of GR 21/2024

[13] Article 38.1 of GR 21/2024

[14] Article 20.2 & 21.2 of GR 21/2024

[15] Article 22.1 of GR 21/2024

[16] Article 22.2 of GR 21/2024

[17] Elucidation of Article 22.3 of GR 21/2024

[18] Article 23 of GR 21/2024

[19] Article 24.1 of GR 21/2024

[20] Article 24.2 of GR 21/2024

[21] Article 68 of GR 21/2024

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