CRANSTON – The state’s 2012 Unemployment Insurance taxable wage base will be $19,600 – up $600 from the current year - for most employers, the R.I. Department of Labor and Training said Friday.
The wage base limits the amount of wages that are taxable. By law, the UI taxable wage base represents 46.5 percent of the average annual wage in Rhode Island, the DLT said.
Tax rates for individual employers, however, vary according to their experience with the UI system, ranging from 1.69 percent to 9.79 percent. New employers will have a 2.64 percent rate in 2012.
Employers will be notified of their new individual tax rates in December, the DLT said in a news release.
The employers in the highest rate – impacting about 19 percent of R.I. experience-rate employers - will have a taxable wage base of $21,100 – $1,500 greater than all other employers which aims to help offset the “large drain these employers have on the Employment Security Trust Fund.”
“Last year, 44.5 percent of all Unemployment Insurance benefit payments were attributed to the top 19 percent of R.I. experience-rated employers,” the DLT news release said.
The department noted that tying the taxable wage base to the average annual R.I. wage and increasing the wage base for employers in the highest tax rate are the result of recent legislative action aiming to restore solvency to the R.I. Employment Security Trust Fund.
As for the Temporary Disability Insurance Fund, the taxable wage base n 2012 will be $60,000 – up $1,600 from last year. The maximum contribution will be $720. The employee contribution rate will drop to 1.2 percent in 2012.