Governor Murphy Signs Legislation to Reduce UI Payroll Tax
To continue supporting our small businesses impacted by the COVID-19 pandemic, Governor Phil Murphy today signed A-4853/S-3011 to reduce businesses' UI contribution rate for a period of time. “COVID-19 continues to pose economic challenges to businesses across the state,” said Governor Murphy. “Today’s bill signing will alleviate the financial burdens many businesses are facing and help them get back on their feet during this difficult time.”
This legislation will reduce the amount of an employer’s unemployment taxes through Fiscal Year 2023. Additionally, the bill will permit nonprofit and governmental employers that elect to make UI payments equal to the full amount of benefits paid to individuals attributable to service in the employ of the nonprofit or governmental employer to reduce their UI benefit payments by fifty percent for the duration of the public health emergency. The bill will result in cost savings to State entities, public institutions of higher education, local governments, and school districts during the pandemic. The short-term savings will be made possible by federal unemployment insurance advances. The recently enacted federal stimulus package extended interest free borrowing of these loans through March 14, 2021. As of December 17, 2020, 20 states and the U.S. Virgin Islands have availed themselves of these loans.
