Unemployment Insurance Tax to Fall by More than Half in Maryland
Many Maryland businesses will get their jobless insurance rates fall by more than half next year, as the state’s trust fund for the payments has a much stronger balance related to last year, state officials declared on October 15th.
According to Gov. Martin O’Malley the tax rate will fall by no less than $100 annually per employee for many businesses from around $187 for each employee this year.
At a news conference, the governor said, “Part of consumer confidence is also business confidence, and business owners, I hope, will draw a little more confidence from the fact that they actually see in a very tangible way that our economy is healing.”
The trust fund currently has a balance of about $795 million, compared with $460.2 million on Sept 30 of previous year. Weekly benefit payments have fell gradually since topping in 2009.
The rate will move from the most disapproving tax rate known as Table F to Table C. Table F’s tax rates ranged from 2.2 percent to 13.5 percent of the first $8,500 in annual wages. For Table C, the rates ranged from 1 percent to 10.5 percent.
The democratic Governor said, “We’re not yet back to schedule A, but we’re moving in the right direction.”
As per O’Malley, around half of the state’s employers are in the lowermost level of the tax table, and they will obtain a 55 percent decrease. All businesses will gain from the changes, officials said.
O’Malley also attributed business owners for keeping people working when it was hard to know when recovered days would come.
House Speaker Michael Busch said the state also has concentrated on policies to retain as many people employed as possible during tough times.
“I think Maryland’s direction has proven to be the right direction to go in and I think this has played out in the fact that our employment rate and our rate of recovery is growing at more a rapid rate than the surrounding states,” the speaker, a Democrat, said.
State officials are also accepting reforms to the trust fund in 2012 for assisting to spark its revival. According to assistant secretary for the Division of Unemployment Insurance, Julie Squire, Maryland officers decided not to lower the tax artificially when the downturn increased demands on it. Maryland also did not take ask out jobless insurance loans.
“Instead we were able to make some key changes to the unemployment insurance law in order to qualify for federal incentive funding,” Squire said. “It’s important to note, however, that the main components of unemployment insurance — including the amount of benefits and the duration of those benefits — have not been changed. Other states have started to lower benefits or reduce duration and that was not done here in Maryland.”
Maryland is capable of getting $126 million in federal funds for the trust fund owing to variations made in legislation in 2010.