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Governor’s Bill to End Automatic Payroll Tax Increases Passes House


April 11, 2013, Juneau, Alaska – Governor Sean Parnell today welcomed House passage of his legislation giving Alaskans a tax break. The bill allows for the suspension of Unemployment Insurance (UI) tax increases when the Alaska UI Fund is deemed solvent. Current law requires payroll increases from employers and employees, even if the UI Trust Fund is solvent. As of March 15, the Alaska Unemployment Insurance Trust Fund had a balance of $257 million.

“I applaud the House for passing this legislation to stop this automatic tax increase on Alaskans so that Alaskans can keep more of their hard-earned money,” Governor Parnell said. “While the federal government increases payroll taxes, we must do what we can to lessen Alaskans’ tax burden.”

Also included within the governor’s bill are provisions that enable Alaska employers to continue to receive federal tax credits for unemployment insurance. Without this legislation, employers could pay out another $378 per employee that they currently don’t have to pay the federal government.

House Bill 76 passed the House 33-6. It now heads to the Senate.

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