Jefferson City, MO - For the third year in a row, thousands of Missouri’s employers will see a reduction in their unemployment insurance (UI) taxes due to a decrease in Missouri’s UI taxable wage base (TWB). For Missouri employers the TWB will decrease $500 as of January 1, 2020, from $12,000 to $11,500.
The TWB is the amount of wages per employee on which an employer must pay UI taxes in a calendar year. Additionally, because of the improving cash balance in the state’s Unemployment Trust Fund (UTF), a majority of Missouri employers will see an additional tax rate reduction of 12 percent. The combined decreases are estimated to reduce employer taxes by as much as $15 million in 2020.
“The Division of Employment Security (DES) continues to work diligently to protect the health of Missouri’s Trust Fund and promote continued economic growth across the state,” says DES Director Chris Slinkard. "Decreasing the taxable wage base and reducing the tax rate enables employers to reinvest the savings into their businesses and, in turn, their communities and local economies.”
The TWB can be increased by $1,000, or decreased by $500 for any year, depending on the average balance of the UTF.
The tax rate adjustment, known as the contribution rate adjustment (CRA), is a percentage increase or decrease to the tax rate based on the average cash balance of the UTF. Rates may be increased by 10, 20 or 30 percent, or reduced by 7 or 12 percent annually.
Missouri employers can see how this change impacts them by logging into their account at uinteract.labor.mo.gov.
Promoting economic vitality across Missouri is one of the primary goals of the Department of Labor & Industrial Relations. To learn more about the strategic changes being made to benefit Missouri’s businesses and workers, visit strategicchange.mo.gov.
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