Unemployment rate hike goes into effect with new year

Beginning Jan. 1, the unemployment tax rate will go up for businesses in Florida as claims continue to rise. A surge in new claims driven by the pandemic continued in December.

The minimum unemployment tax rate on the first day of the year jumps from 0.1% to 0.29%, nearly tripling the lowest rate assessed to businesses, according to the Florida Department of Revenue. The maximum tax rate remains at 5.4%, except for those employers participating in the Short Time Compensation Program. The rate will be imposed on annual wages of up to $7,000 per employee.

When a new employee becomes liable for reemployment taxes, the initial rate continues to be 2.7% and holds at that level for 10 quarters. The account at that point get rated based on the total benefits charged based on payroll from a running seven-quarter period.

The increase in the bottom rate comes as the state continues to wrestle with massive numbers of new unemployment claims. About 67,000 more jobless claims were filed a week before Christmas.

But of note, the tax increase will not generate an immediate leap in revenue for the Department of Economic Opportunity immediately. The state allows a period of time for

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