Las Vegas Sun

April 16, 2014

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Nevada businesses to save $70 per employee next year

Nevada businesses will be getting a break on their unemployment tax next year.

Renee Olson, administrator of the state Employment Security Division, set the tax rate Wednesday at an average 1.95 percent per worker, down from 2.25 percent.

The tax rate is assessed on an annual salary of $27,400.

Kelly Karsh, deputy administrator, said the lower tax rate would save employers an average of $71 a year per employee. The annual payment per employee will go from $605 to $534.

About 36,000 employers in the state pay a rate ranging from 0.25 to 5.4 percent based on the turnover in their company. Just over 21,400 new employers currently pay a 2.95 percent rate for three years until they are rated on their turnover.

Karsh said the Employment Security Division is trying to keep the rate low because many employers are still struggling in current economic conditions.

The division recently sold $612 million in bonds at an interest rate of below 1 percent. Karsh said $580 million went to pay off the federal government, which loaned Nevada about $800 million during the recession to pay unemployment benefits.

The federal government was charging the state more than 2 percent interest on the loan, so selling the bonds to pay off the loan will save the state about $24 million.

Karsh said there would be a special assessment next year to help pay off the bonds, which are to be retired in four years.

A small part of the bond money will be used to help restore Nevada's unemployment trust fund.

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