Chapter IV : REVENUES AND FINANCIAL ORGANIZATION
ARTICLE (17)
The revenues of the Organization shall consist of:
1. the contributions of the employers and contributors provided for in Article (18), the contributions imposed to finance other branches of insurance in accordance with the provisions of Articles (1) and (4) of this Law, and the contributions paid in accordance with the provisions of paragraph (2) of Article (38);
2. the state annual subsidy allocated in the State general budget, as needed;
3. the additional amount provided for in paragraph (5) of Article (19) hereof in respect of delay in payment of contributions;
4. the returns of investment of the Organization’s funds;
5. the donations and bequests made to the Organization; and
6. such other revenues as may be allocated for the Organization by virtue of the provision of another law or regulations.
ARTICLE (18)
1. The contributions for the Occupational Hazards Branch shall be fixed at 2% (two percent) of the contributory wages of the contributor and shall be payable by the employer. This rate of contribution may be increased to double the amount for employers who refuse to abide by the instructions issued by the competent authorities in regard of the safety and health of workers. The procedures for the implementation of this last provision shall be prescribed by the Regulations. As for the contributors of other categories mentioned in paragraphs (4) and (5) of Article (4), each of such contributors shall pay the fixed contribution.
2. a. The contribution for the Annuities Branch in respect of the contributing workers provided for in paragraph (2) of Article (4) shall be fixed at 18% (eighteen percent) of the contributory wage, of which 9% (nine percent) shall be payable by the employer and 9% (nine percent) shall be payable by the contributor, with due regard to the provisions of Article (65).
b. The contribution for the Annuities Branch, in respect of the contributors of the categories mentioned in paragraph (4) of Article (4) shall be fixed at 18% (eighteen percent) of the assumed wage chosen by the contributor in accordance with the provisions of Section 3 of Chapter V, which contribution shall wholly be payable by the contributor.
3. The rate of contribution provided for in the preceding two paragraphs may be modified by a decision of the Council of Ministers issued on the recommendation of the Minister after the Board of Directors shall have expressed a motivated opinion based on an actuarial study.
ARTICLE (19)
1.a.The contributions provided for in paragraphs (1) and 2(a) of the preceding Article shall be computed on the basis of the basic monthly wage received by the contributor. The Regulations shall prescribe the basic wage and may, for the purposes of computation of contributions, add to the wage any of the allowances and benefits in kind due to the contributor. The regulations shall also prescribe the method of determining the contributory wages of the contributing workers whose wages are determined by piece, as well as the method of computation of the amount of contributions payable in favour of the apprentice worker.
b. The maximum contributory wage shall be SR 45,000 (forty five thousand Saudi Riyals) per month. This limit may be raised by the Regulations as revealed by a revision of wage levels to be made from time to time.
2. The contributions due under the provisions of paragraph 1 (a) for the increases in the contributory wage of the worker shall no more be paid with effect from the date on which he reaches age fifty except to the extent of the percentage prescribed by the Regulations, with due regard to the wage levels and the various increases therein.
3. The method of computation of contributions shall be determined by the Regulations. The Regulations may provide for the contributions to be computed on the basis of the wages referred to in paragraph 1 (a) and actually received month by month including any reduction or increase therein or to be computed on monthly basis without being affected by sudden reduction in such wage, or to be computed for all months of the insurance year on the basis of the contributory wages agreed for the first month of the year. The Regulations may also provide for contributions to be payable on lump-sum basis or according to the wage graduation in respect of certain categories of contributors. In all cases, benefits shall be computed on the basis of the wages used for the purposes of determining the due amount of contributions.
4. The employer shall pay to the Organization the full amount of contributions due from him and from his contributing worker, and the employer alone shall be responsible towards the Organization for the payment of such contributions. In return, the employer may deduct from the wage of his contributing worker the contributions due from the worker every time he pays him his wage. Should the employer fail to withhold such contributions upon payment of the wages, he may not withhold such contributions in any form thereafter.
5. Contributions shall be paid to the Organization within the first fifteen days of the month immediately following that for which the contributions are due. If payment is not affected within this period, the employer shall pay a fine for delay at the rate of 2% (two percent) of the unpaid contributions for each month or fraction of a month of delay. The Regulations shall prescribe the maximum fines for delay and the cases in which payment of all or part of the fines may be exempted.
6. All state and semi-state bodies and state-owned or shared companies, or joint stock companies shall require the employer dealing with them to submit a certificate issued by the appropriate insurance office evidencing that his firm has been registered with the Organization and that he has discharged all his obligations towards the Organization or otherwise that he is not subject to the provisions of this Law, upon:
a. claiming his due payments in accordance with the rules and procedures followed in the collection of entitlements of the Zakat and Income Department;
b. tendering for execution of any of the works, supply, operation or maintenance contracts ;
c. applying for amending his commercial register, reviewing it or making an addition to the date thereof;
d. applying for receipt of the aid determined for him by the State;
e. considering liquidation of his firm or firms;
f. applying to the competent authorities for approval of recruiting workers from abroad ; or
g. applying for a license for any project or for renewal of such license.
7. The Regulations shall specify the method of payment of the contributions. They may also provide for payment of contributions due in respect of certain categories of workers by means of stamps to be affixed to cards or booklets prepared for this purpose.
8. The Employer shall, within the period prescribed in paragraph (5) of this
Article, submit to the Organization monthly payrolls in the forms specified by the Organization.
ARTICLE (20)
1. The collection of contributions and fines imposed for delay is guaranteed as a privileged claim in favour of the organization which comes immediately after payment wages in the order of privileged claims.
2. The Organization may, after obtaining a court order, effect through the official authorities, attachment or compulsory execution on any of the funds owned by the employer or due to him from any government agency or individual for the purpose of settlement of the amounts due to the Organization so long as the statements of such amounts are duly approved by the Minister.
ARTICLE (21)
Each of the branches of insurance shall have accounts of its own. The Board of Directors shall allocate to each branch its share in the administrative expenses and shall lay down the rules governing the distribution among the various branches of the revenues that do not belong to any particular branch.
ARTICLE (22)
The funds and revenues of the Organization shall only be used for providing the benefits provided for in this Law and for covering the necessary administrative expenses of the Organization.
ARTICLE (23)
The fiscal year of the Organization shall be the Hijrah year.
ARTICLE (24)
The financial Regulations shall regulate the following matters:
a. The budget and final account.
b. The accounts.
c. The balances of contributors’ entitlements which are not due yet.
d. The investment of funds.
e. Any other matter related with the financial management of the Organization and has not been provided for in this Law.
ARTICLE (25)
A detailed study of the financial position of the Organization and each insurance branch shall be made at least once every three years. The results of such study may be taken as a basis for the revision of the contribution rates in accordance with the provisions of paragraph (3) or Article (18). Should the study reveal an actuarial deficit, the State shall cover such deficit by means of subsidy appropriations in the general budget.
ARTICLE (26)
The administrative expenses of the Organization may not exceed 5% (five percent) of its revenues. However, the Minster may, by decision of the Council of Ministers on the recommendation of the Minister, reduce such rate or raise it up to 7% (Seven Percent) as a maximum.