Government Reduces the Rate of ESI Contribution from 6.5% to 4%

The government has reduced the total rate of contribution made by workers and employers towards the Employees’ State Insurance (ESI) scheme from 6.5% to 4% for the first time in over two decades.

At present, nearly 4.75% of a worker’s monthly salary goes towards ESI as the employer’s contribution and 1.75% of the income is the employee’s share at present.

Now, 3.25% will be the employer’s share and 0.75% the employee’s.

This will be effective from July 1, 2019.

Source: Business Standard

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