Governor Phil Murphy signed into law a bill that will spread out unemployment tax increases over three years. Both the federal government and individual states tax the wages businesses pay in order to fund their unemployment insurance offered to individuals who lose their jobs. The dramatic increase in unemployment caused by the pandemic and related shutdowns has depleted the funds available and could result in an increase from 0.7% of payroll to 1.1% in July 2021.
The bill signed by Governor Murphy will phase in any tax increase over three years and prevent some increases for employers that were hardest hit during the pandemic.
The phased-in approach of the bill will ensure employers, including dealerships, don’t get hit with a huge increase all at once.
NJ CAR will continue following this story and report any details as they become available.