ST. PAUL – State Representative Bob Dettmer (R-Forest Lake) said Minnesota employers are now seeing increases on their unemployment insurance rates come to light after House Democrats stopped preventative legislation from reaching enactment.
“This tax increase was easily avoidable, but House Democrats insisted on playing political games, and now local employers are literally paying the price,” Dettmer said.
Dettmer said this tax increase is a result of the state’s unemployment insurance trust fund becoming depleted with more people out of work during the pandemic. The federal government provided funding to the state to keep the program in operation and now Minnesota’s debt of more than $1 billion is due. Without legislation enacted by March 15 to at least pay the federal debt, a tax increase on Minnesota employers becomes the default.
Senate Republicans and Democrats approved legislation that would have prevented this tax increase from taking effect. Dettmer said House Republicans supported it as well, but House Democrats – the majority party in the House - failed to even bring a bill forward that addressed the topic.
Dettmer noted that employers could face state and federal penalties if they do not comply with the state’s new unemployment insurance tax rates, a minimum $250 per month for late filing/payment or $10 per employee, whichever is more. Federal penalties could be up to 15 percent of the amount owed, plus potential criminal penalties.
“As irritating as all of this is, I strongly encourage our local employers to review their tax tables and plan ahead,” Dettmer said. “While its clear House Democrats don’t think higher taxes and potential penalties on job providers in this state are a big deal, I do not want to see any business owner harmed due to DFL inaction.”