Gov. Rick Scott signed legislation Wednesday that includes a host of tax cuts for businesses and rebrands the state’s financially strapped unemployment compensation system.
Scott said the four bills he signed, flanked by leaders of state business organizations, represents his “job creation and economic growth agenda.” One of the measures, (HB 7087), also doubles to $50,000 the state’s corporate income tax exemption — further shrinking a levy Scott has vowed to eliminate over the next five years.
“With this plan, our unemployment rate will continue to go down,” Scott said. “Job creators will experience tax relief. Job seekers will have a better chance to get back to work. Florida is clearly going to be the state that everyone has to compete with.”
Among the more controversial measures is the unemployment compensation bill (CS/HB 7027). Scott and the Republican-led Legislature last year reduced the number of weeks jobless workers could receive benefits, and this year, rename the system the “reemployment assistance program.”
The legislation also cuts the tax businesses pay to cover employees in the system, saving companies an estimated $800 million over the next three years. Currently, employers were on track to pay $171-per-worker this year. The bill cuts that to $121 for each employee.
The legislation also delays Florida’s efforts to rebuild its unemployment compensation trust fund by reducing the base wage subject to the tax, and increasing the debt repayment schedule. The delay was pushed by such business groups as the Florida Chamber of Commerce, Associated Industries of Florida and the National Federation of Independent Business, which said prospects of an $817 million unemployment compensation tax increase would be tough to absorb in a still-fragile economy.
Scot acknowledged Wednesday that he was initially reluctant to embrace what amounts to the third consecutive year of delayed payments. But Scott said he eventually saw a benefit in slowing the debt payments.
“It made sense,” Scott said. “We want employers to hire more people. We have to think like they do. They’ve got to keep their costs as low as they can.”