Gov.'s revised budget would slash unemployment insurance taxes for businessesby Annie Baxter, Minnesota Public Radio
ST. PAUL, Minn. — Unemployment insurance taxes from businesses would be slashed by a total of nearly $350 million under Gov. Mark Dayton's revised budget proposal.
Businesses pay a base tax for unemployment insurance for all employees on their payroll. Companies that have laid off numerous workers pay extra. During the recession, employers were also hit with special assessments. Those assessments helped repay the federal government, which lent the state money when its unemployment insurance trust fund ran dry.
The trust fund is now solvent, but employers are still paying the assessments.
Rick Caliguiri, who runs the state's unemployment insurance division, said the assessments would end on their own over the next three years. But the governor's proposal would lower them more quickly. It would also lower the base tax companies pay.
"The average employer in 2014 will probably end up getting a tax break around $156 per employee," Caliguiri said.
The proposal is progressing through the legislature and is now part of the state government finance bill.