News of the Nature Coast of Florida

The Citrus County Commission is concerned about a twelvefold increase in the state unemployment compensation tax.

Under state law, businesses throughout the state must fork out more in taxes if the trust fund falls below 4 percent of the total taxable payroll in the most recent fiscal year, which it did in 2009. That being the case, it automatically triggers an adjustment in unemployment tax rates for the next year.

The minimum annual rate — charged to an employer with a solid history of retaining employees — will jump from $8.40 per employee to $100.30, according to the Florida Department of Revenue. The maximum rate, currently $378 per employee, would rise to $459. When Florida’s unemployment rate spiked to 11.2 percent in October 2009 — the highest in 34 years — it triggered a tax increase, effective for wages after Jan. 1, 2010. At last report, the state was trying to make up for a $1.7 billion shortfall.

County Commissioner John Thrumston told commissioners that he has had to assure businessmen here that, although the county can't control the tax, it can support the businessmen as best it can. To that end, the county commission voted today to to send a letter to the state's association of counties to ask the area's Congressional Delegations to help. But time is short. The next tax bills go out in March and come due at the end of April. The Legislature doesn't convene until March 2.

"It threatens the recovery of our economy," Thrumston said of the tax hike.

Commissioner Winn Webb said that one businessman told him that he's now paying $300 in tax for two employees, and that amount will rise to $2,000 under the higher tax. "And the federal government wants to get in on it," Webb said. "And that amount would rise to $4,000."

The steep rise in the tax is not just a local problem, Commissioner Dennis Damato said, but the method of paying for extended unemployment benefits is also a problem facing the state and nation, and that there needs to be a more broad-based solution than that prescribed by current state law.

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