Texas Workforce Commission Adopts No New Increases to Employer Tax Rates for 2022

Sustained rates will continue to protect Trust Fund solvency without increasing tax burden on Texas employers

Texas Insider Report: AUSTIN, Texas – On November 23, 2021, the Texas Workforce Commission (TWC) set unemployment insurance (UI) tax rates for 2022 at a stable level to avoid burdening Texas businesses with a significant increase of taxes resulting from pandemic-related closures outside of their control. This action is a result of the statutory authority of the Commission and was supported by funding from Senate Bill 8 (SB 8), passed during the 3rd Special Session of the 87th Texas Legislature and signed into law by Governor Abbott.

“Building a brighter, more prosperous future for all Texans includes preserving the ability for businesses to grow and thrive,” said Governor Greg Abbott. “Thanks to Senate Bill 8 and the leadership of the Texas Workforce Commission, Texas employers will be protected from harsh unemployment insurance tax hikes this coming year and can instead invest in creating more jobs and better economic opportunities for hardworking Texans across the Lone Star State.”

Employer-paid UI taxes replenish the Texas Unemployment Compensation Trust Fund, which provides temporary income for workers who lose their jobs through no fault of their own. Each employer’s UI tax rate is unique, tied to unemployment benefits paid to former employees. Absent SB 8 and the Commission’s action, most Texas employers would have seen significant increases in their tax obligation for 2022. 

“Setting the 2022 UI tax rate with no increase from last year helps Texas employers to better focus resources on innovations that create more jobs,” said TWC Chairman Bryan Daniel. “Job growth is a key component of our economic success.”

The Commission set the state’s UI replenishment tax rate to 0.20 percent, and the deficit tax rate to 0.0 percent. The Obligation Assessment was set to 0.01 percent to ensure that any federal interest due on Title XII loans were covered. 

“This decision to keep taxes low is great news for our Texas workforce,” said TWC Commissioner Representing Labor Julian Alvarez. “Lower UI tax rates encourage hiring and help continue to expand career opportunities for Texans, while still providing unemployment compensation to those who qualify.”

By setting this tax rate, TWC aims to support employers’ ability to continue growing their businesses and the Texas economy, while ensuring trust fund operations.

“This decision gives stability to our UI tax structure and ultimately will benefit all Texas employers,” said TWC Commissioner Representing Employers Aaron Demerson. “In addition, the tax rates set give Texas employers the capacity they need to continue hiring, expanding, and making our Texas economy thrive.”

The Texas Workforce Commission is a state agency dedicated to helping Texas employers, workers and communities prosper economically. For details on TWC and the services it offers in coordination with its network of local workforce development boards, call 512-463-8942 or visit www.texasworkforce.org. To receive notifications about TWC programs and services, subscribe to our email updates.
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