Indiana mulls $1 billion tax hike for unemployment fund

(photo supplied / Indiana Statehouse)

Gov. Eric Holcomb’s administration is pushing for an increase in business taxes to provide $1 billion more for Indiana’s unemployment trust fund.

The Journal Gazette reports that the proposed 17% increase would bring premiums paid by companies to a level recommended by the federal government.

Business groups questioned the recommendation, suggesting that it would take money that could be invested in creating jobs and leave it “sitting on the sidelines” in the fund, which pays unemployment checks when the jobless rate is high.

Republican Rep. Dan Leonard, the House expert on the unemployment fund, says Indiana is on track to hit $1 billion in fund reserves by the end of next year. U.S. Department of Labor guidelines indicate the state needs $1.8 billion on hand.