Employers to Pay More in Unemployment Taxes

Here is another glance at your government at work: employers who are already doing their best to brave the recession will be paying a total of $39 million more in unemployment taxes to the state next year. Which we can only imagine will make things harder for them, which, in turn, will make it that much less likely that they will be making any new hires. Did it occur to anyone that instead of instituting a financial penalty for not hiring more people, that it would be better for the unemployed, better for employers, and better for state finances to create incentives for hiring? Well, at least Gov. Carcieri had that thought when he proposed a tax credit for hires. But clearly, more has to be done to reform the state unemployment system. In the late 1990s, the state reduced the amount of unemployment taxes businesses would have to pay, but, of course, lawmakers didn’t make a corresponding adjustment to how benefits are calculated. With the second highest benefit for people with dependents, at $682 a week, maybe it’s a time to revisit that. For past OSPRI commentary on this issue, click here.


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