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Unemployment Tax Tripling For Most Texas Businesses

By Shelley Kofler, KERA News

Dallas, TX –

The unemployment tax next year is tripling for nearly two-thirds of Texas businesses, and going up for all of them. KERA's Shelley Kofler has details.

Texas businesses support the fund that pays unemployment benefits. So when the jobless rate climbs- as it has- the business tax goes up to replenish the fund.

Over the past year the number of unemployment claims in Texas has risen some 86 percent. The state is already borrowing about a billion dollars in federal interest free loans to help pay the claims. It plans to sell $2 billion in bonds next year to help.

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But Workforce Commission Chairman Tom Pauken says raising the unemployment tax rate is also necessary.

Pauken: We've tried to keep it as low as possible under the circumstances but the system needs to be self supporting and we had no other alternative except to set the rate at what we did.

The unemployment tax for a majority of Texas businesses will increase from $23 to $65 for each worker employed. Businesses that have laid off a lot of workers are charged the highest rate and will see their tax rise to $774 per employee.

Pauken says the impact of the unemployment tax is small compared to what businesses pay in property taxes and insurance. But the hike will still hurt, and the rate is not expected go back down next year.

Email Shelley Kofler