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BILL REDUCING UNEMPLOYMENT TAX RATE
HEADS TO SENATE
JACKSON – Mississippi employers could save up to $20 million annually under a bill that passed the Senate Finance Committee today, Lt. Gov. Tate Reeves said.
Senate Bill 2808 goes to the Senate for consideration. The bill, sponsored by Sen. Joey Fillingane, R-Sumrall, would reduce the unemployment tax rate on Mississippi employers.
“This legislation is smart fiscal policy that reduces the tax burden on our job creators, allowing them the flexibility to hire more workers and increase wages,” Lt. Gov. Reeves said. “Reducing unemployment tax rates, cutting the corporate franchise tax, and giving taxpayers a pay raise by eliminating individual income tax brackets is a winning combination that will spur long-term economic growth. I look forward to continuing to work with Gov. Bryant to fight for tax relief for Mississippians this legislative session.”
Currently, employers must pay unemployment insurance taxes on a portion of employee wages. Statutorily, the tax rate is between 0.2 percent to 5.4 percent depending on economic activity, such as layoffs or job growth. Under Senate Bill 2808, the minimum tax rate drops to 0.0 percent, resulting in an up to $20 million tax cut for Mississippi employers.
The Unemployment Insurance Trust Fund is actuarially sound, which allows the employers’ tax rate to be lowered.
The bill also creates a sustainable workforce training fund, the Mississippi Works Fund. Approximately $10 million will be deposited into the fund in the first year, with about $5 million deposited into the fund in subsequent years. These dollars primarily will be used by the state’s system of community and junior colleges to meet the training needs of new jobs created in the state, as well as to help with job retention and increasing the capacity of Mississippi’s labor force pool.
