Senate Passes Sen. Corbin Bill to Freeze Low Unemployment Insurance Tax on Employers

Bill maintains low 1.9% unemployment insurance tax rate

Without action, tax rate would have jumped because an automatic formula

Raleigh, N.C. — The North Carolina Senate today passed Senate Bill 311, sponsored by Sen. Kevin Corbin, to freeze the low unemployment insurance tax rate on employers.

Unemployment assistance to people who lose their jobs is funded from a tax on employers.

Without legislative action, the tax on employers would have jumped because of an automatic formula that triggers tax rate changes based on the balance in the unemployment insurance reserve.

That reserve still has a healthy balance of about $2.9 billion, but it’s below previous levels because so many people received unemployment benefits during the pandemic.

Because there is no expectation of another protracted unemployment crisis that threatens the unemployment reserve, legislators thought it best to avoid a rate increase and freeze the current unemployment tax rate at 1.9%.

Sen. Kevin Corbin said, “North Carolina is the best place in the country to start a business because of low-tax, low-spending Republican policies. This bill to maintain the current low unemployment insurance tax rate is yet another example of the pro-business, pro-economy Republican philosophy.”