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Business Leaders 'Outraged' Over Jobless Bill
Law Will Raise Taxes On Employers
POSTED: 6:52 pm EDT May 14,
2009
UPDATED: 7:16 pm EDT May 14,
2009
INDIANAPOLIS -- While those who are unemployed may be happy they won't see a cut in benefits, Indiana business leaders said they are outraged over a bill to rescue the state's bankrupt unemployment fund.Gov. Mitch Daniels on Wednesday signed a bill that will increase unemployment taxes on employers, but not cut benefit payments, 6News' Norman Cox reported. Proponents say it also will close loopholes in the system and make other changes to save money.But members of the Indiana Chamber of Commerce on Thursday expressed disbelief and outrage concerning the tax hike. They said it's not fair to put the entire burden on them.
Commonwealth Engineers on the south side is typical of how the impact will be felt. The company employs 56 people and, until last year, had rarely laid off anyone. But when eight employees were laid off, it put the company in a higher unemployment tax bracket.The combination of that and the new higher rates will cause the company's bill for unemployment insurance to rise from $20,000 a year to $35,000 this year and almost $40,000 next year.Company executives said that could have an impact on future hiring, even when the economy rebounds."We're not going to be laying anybody off specifically because of that impact. But it makes us take a second look as to, you know, do we bring people on fulltime, or do we kind of use them as a temporary situation?" said spokesman Jeffrey Ponist.Although business groups don't like the law, it was actually a compromise. It doesn't reduce benefits to laid-off workers as Republicans wanted, but the tax increases on businesses are much smaller than the one Democrats initially proposed.The Chamber of Commerce has asked the Legislature revisit the issue when it convenes for its special session this summer, but that appears unlikely.
Previous Stories:
- May 13, 2009: Daniels Signs Bill Designed To Fix Jobless Fund
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