Taiwan labour insurance hike adds $413m to business costs

More than 10.51 million workers will pay higher contributions next year.

Taiwan’s labour insurance contribution rate will rise by 0.5 percentage point to 13% in 2027, reaching the statutory ceiling under the Labour Insurance Act.

The increase is expected to raise insurance costs for employers and workers nationwide. Nearly 626,000 businesses are expected to incur an additional $413m in costs next year, whilst more than 10.51 million workers will face higher contributions, according to UDN, as reported by Taiwan News.

The 13% rate includes a 1% employment insurance component, meaning the ordinary labour insurance rate will rise to 12% next year.

Premiums are shared between employers, workers and the government, which pay 70%, 20% and 10%, respectively.

Premiums are based on an insured salary scale rather than an employee’s actual salary. The maximum monthly insured salary for labour and employment insurance is $1,436.2 (NT$45,800).

Based on an average insured salary of $1,145.2 (NT$36,511), the 0.5 percentage point increase will add an estimated $4.01 (NT$127.79) a month to an employer’s contribution for each worker.

Workers will pay an additional $1.15 (NT$36.51) a month, or about $13.74 (NT$438.14) a year.

The increase is expected to generate about $722.0m (NT$23.021b) in additional labour insurance revenue each year.

($1.00 = NT$31.89)