ST. PAUL – State Representative Rod Hamilton (R-Mountain Lake) said an unneeded tax increase on local employers will be eliminated following approval of recent legislation.
Hamilton, who serves as the Republican Lead on the Minnesota House Workforce and Business Development Policy and Finance Committee, voted in support of the bill that ultimately replenishes Minnesota’s unemployment insurance trust fund.
“It took far too long to get this legislation across the finish line, but I am pleased we were able to eliminate this state debt and eliminate a very problematic tax increase on our job providers,” Hamilton said.
When Governor Walz required businesses to close due to the COVID pandemic two years ago, thousands of Minnesotans were forced to go on unemployment. The federal government loaned Minnesota more than $1 billion to meet the unemployment insurance demand, and Minnesota needs to repay the debt.
Hamilton said the State has been paying $50,000 a day just in interest costs while the issue lingered at the Capitol. Because the Legislature had not allocated available state surplus or federal COVID resources to solve the UI trust fund problem, the default repayment was a 15% or more tax increase on every Minnesota employer.
Hamilton said the compromise proposal between the House and Senate fully replenishes the unemployment insurance trust fund at $2.7 billion and ends the tax increase on Minnesota’s job providers.
“With a $9.3 billion surplus there was no reason to raise taxes on anyone,” Hamilton said. “I’m glad we were able to finally act on behalf our employers.”