Montana Unemployment Insurance Rate Drops for Most Businesses
Montana Businesses will be paying a little less in taxes as the state moves into the holiday season.
"It's good news," said Montana Commissioner of Labor and Industry Pam Bucy. "The unemployment insurance contribution rate schedule was adjusted down a full notch from a six to a five. That's good news for Montana businesses. It means reduction in unemployment insurance tax."
The rate schedule dropped because of the amount of money in the state unemployment insurance trust fund. During the recession, businesses saw their rates climb as the trust fund saw more use. The changes in the unemployment insurance tax rate are set by a formula.
"It demonstrates how thoughtful those legislatures and business folks were in the late 70s, early 80s when they changed how we did unemployment in Montana and made sure we had these automatic rate adjustments based on the soundness of the trust funds, and not necessarily political will," Bucy said.
There are 11 different tax schedules. Bucy said that Montana will soon drop again, from schedule five to schedule four, as the amount of money in the trust fund increases.
It is important to point out that not all types of businesses will see a tax rate drop. Businesses pay into the trust fund at a rate partially based on the amount of use of the trust fund that that type of business might make annually. For example, businesses that are seasonal in nature, will likely be paying more in unemployment insurance than other businesses.