Maryland employers will continue to benefit from the lowest possible unemployment insurance tax rates allowed by law, thanks to falling unemployment rates and correspondingly lower unemployment benefit payments.
Employers in the state will contribute 0.3 percent to 7.5 percent of employee pay into the unemployment benefits pool in 2017, while new employers will pay 2.6 percent. The rates were announced by Gov. Larry Hogan on Oct. 26.
One exception is for new construction employers with headquarters in another state; their rate will be 6.6 percent.
The taxable wage base for 2017 will remain unchanged at $8,500.
“Most Maryland employers pay the minimum tax rate, so many will continue to pay $25.50 per employee per year,” The Baltimore Sun reported.
“Growing Maryland’s economy is our administration’s number one priority,” Hogan said. “By improving our state’s business climate, employers are able to benefit from a continued low unemployment insurance tax rate, which allows them to create even more jobs and opportunities for our hard-working citizens.”
Some 146,300 employers are doing business in Maryland — the highest number in history. That number has risen by more than 7,000 since January 2015.
Meanwhile, Maryland’s unemployment rate stands at an eight-year low of 4.2 percent. That means unemployment benefits paid fell by almost $80 million from fiscal 2016 to 2016.
“As the unemployment rate decreases, not only are more Marylanders working, but the amount of state benefits paid also decreases,” said Maryland Labor Secretary Kelly Schulz. “Employers are able to thrive and create jobs as the state and business community work together to continue strengthening our economy.”
Since Sept. 30, 2015, Maryland’s Unemployment Insurance Trust Fund has grown by more than $94 million to nearly $1.1 billion.
“The Maryland Unemployment Insurance Program is financed by the Federal Unemployment Tax Act and is administered by the Maryland Department of Labor, Licensing and Regulation,” Gov. Hogan’s office stated. “As required by Maryland law, the Division of Unemployment Insurance does an annual ‘temperature check’ on the Unemployment Insurance Trust Fund. This temperature check is made using the ending balance of the trust fund every Sept. 30. The reconciled ending balance is compared to the taxable wage base for the preceding four quarters. That ratio determines the UI Rate Table for the next calendar year.”