The bill's aim was to fix the state's insolvent unemployment trust fund, but instead, it may only exacerbate the problem by causing struggling businesses to shed more jobs or raise prices to pay for the tax.
"The unemployment insurance fix creates one of the largest tax increases on businesses in Indiana's history during incredibly difficult economic times," said Rep. Dermody. "The issue I have is we still haven't solved the problem. All we heard this session is, 'We need to create jobs.' Well, this bill does just the opposite. It will cause employers to cut jobs or freeze hiring plans. Placing a huge tax on the one group that can help fix the unemployment crisis, employers, does much more harm than good.
"It's simply not sound public policy to place an enormous burden on the people who provide jobs. Raising taxes is never a solution to any problem. Government can't continue to accept the flawed mindset that creating new taxes is a cure-all solution."
The bill passed the House 52-47 and now travels to the governor's desk.