Balancing expenses, from employee salaries to unemployment insurance taxes, is something that every business owner has to consider carefully. A slip-up here or there or an improper benefits payment could result in you having to spend more money, and issues on the state level can directly impact these costs.

For example, in Massachusetts, lawmakers have been debating the idea of raising the state’s minimum wage. While this is something that would garner widespread support from many workers, it has encountered some challenges from local businesses. However, that could change if an agreement to lower statewide unemployment insurance taxes is reached.

Higher Massachusetts UI taxes postponed
Unemployment insurance has been a hot topic for Massachusetts legislators over the past several months. A proposal to increase these taxes was set to go into effect, but at the end of March lawmakers agreed to push back the payments deadline by one month, according to The Boston Globe.

Originally, the payments related to a 30 percent bills increase was due on the last day of April, the media outlet reported. Now, that deadline is the end of May. The average premium for the state’s employers was set to rise from $707 to $943. If enacted, the change would have cost businesses an estimated $520 million in unemployment insurance taxes. Instead, legislators will continue to discuss a freeze on the proposal while the recommendation of a higher minimum wage remains.

Tax break for minimum wage increase?
Most employers in Massachusetts were strongly opposed to a higher minimum wage, according to a separate report from The Boston Globe. However, that could change if a freeze is passed on the unemployment insurance tax hike.

“I think we’d be more tolerant, more accepting to an increasing cost in one area if we could point to a decreasing cost in another area,” John Regan, a lobbyist for Associated Industries of Massachusetts, told the media outlet.

The concept of requiring employers to pay more taxes has often been debated in Massachusetts. Some lawmakers fear higher costs would prevent companies from hiring, thus damaging the economy as a whole. However, an increased minimum wage might encourage greater consumer spending – a boost to businesses across the state. If this is the case, the costs could balance out. In the meantime, businesses and legislators will continue to discuss the possible changes.

Juggling tax rates, expenses and difficult employees can become challenging at your company. Here at Corporate Cost Control, we understand these problems and are well positioned to help. Our extensive background in cost control and human resources will allow you to better manage your unemployment insurance expenses.


Contact CCC to see how we can save your organization time and money.
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(800) 207-6926

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