Idaho Governor Brad Little announced today a significant reduction in the state’s unemployment insurance tax rate for 2025, marking a 20% decrease from the previous year. The move is expected to save Idaho employers approximately $22 million.
The base unemployment insurance tax rate will drop to 0.788%, the second-lowest rate recorded since 1980. This reduction reflects Idaho’s strong economic performance and job growth, with the state leading the nation in job creation since the pandemic.
“Our tax rates continue to decline because of Idaho’s robust economy,” Governor Little said. “We’ve delivered on our promises to families and businesses, ensuring a thriving environment for growth and success.”
Despite the tax rate reduction, the taxable wage base—the maximum amount employers pay unemployment taxes per employee—will rise slightly from $53,500 to $55,300 in 2025. The new employer rate will remain at 1.0%, the lowest rate allowed under federal requirements.
Idaho businesses will receive notification letters with their updated unemployment tax rates in the coming week. Employers are also encouraged to help maintain low rates by reporting any fraudulent unemployment insurance (UI) activity to the state.
The tax cut highlights Idaho’s continued efforts to support businesses and strengthen its economy while keeping taxes low.
By: DNU staff