Corzine moves to avoid employer tax hike

[Mugu]

By TOM HESTER Jr., Associated Press Writer via Newsday
April 1, 2008

TRENTON, N.J. - Gov. Jon S. Corzine on Tuesday moved to avoid a tax increase on employers that would be triggered if a state fund meant to pay benefits to out-of-work New Jerseyans dwindles too low. The fund had been raided for 14 years to help pay for health care.

The governor said the fund, which pays weekly unemployment benefits, is projected to fall below a minimum reserve level that would trigger an automatic $350 million increase in employer payroll taxes as of July 1.

"We should avoid imposing a $350 million tax increase on employers during this national recession," Corzine said. "I am asking for the Legislature's help to address this problem now to prevent this tax increase, so that businesses will have a stable and certain tax environment for economic growth in New Jersey."

The problem comes after legislators and governors diverted $4.7 billion from the fund from 1993 until 2006 to help hospitals pay for treating uninsured patients. "We are now seeing the result of 14 years of Unemployment Trust Fund raids and fiscal mismanagement," Corzine said.


Complete article at:
http://www.newsday.com/news/local/wire/newjersey/ny-bc-nj--unemploymentfund0401apr01,0,6264065.story