House OKs 70% unemployment tax hike on businesses

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SANTA FE, N.M. (AP) — The House has approved a bill to increase taxes on businesses and trim jobless benefits to shore up the state unemployment compensation program.

The measure raises taxes in January 2012 and will trim some benefits starting this summer.

If nothing is done by the Legislature, the unemployment fund is projected to become insolvent early next year.

The fund is being drained because of high unemployment — 8.5 percent in December.

The average tax payments by a business for each of its employees will go to nearly $370 a year in January, up more than 70 percent.

The legislation will eliminate jobless benefits for full-time students and reduce supplemental payments the unemployed receive if they have dependents.

The House approved the bill 59-9 on Friday and sent it to the Senate.