Thursday, January 12, 2012
House Minority Leader Bradley Jones (R-North Reading) and I have joined with our House and Senate Republican colleagues in filing legislation to freeze the currently scheduled unemployment insurance tax rate, citing the current economic climate as the primary reason for such a measure.
If passed, the unemployment insurance tax rate would stay at its current level, preventing an increase of about 31%, with an average cost of $935 per employee, compared to last year’s $715 average tax rate. It would mark the fourth straight year that similar legislation had been passed by the legislature and signed into law.
Unemployment insurance is already a major cost for employers in Massachusetts, and one that relates directly to the number of people they employ. A substantial rate increase now will not only imperil a struggling economic recovery, it will also put a new obstacle in the way of getting people back to work.
In October 2010, the Tax Foundation, a Washington D.C. think tank, ranked the Massachusetts’ unemployment insurance tax 49th worst in the nation. The scheduled unemployment insurance tax rate took effect on January 1st; however, employers will not have to begin paying the tax until the end of the first quarter. Currently, the Republican caucus is also working on some long range reforms to the unemployment insurance system to help lower the cost of doing business in Massachusetts and promote more job creation statewide.