Missouri Notes 50% Drop in WC Tax and Surcharge

Gov. Matt Blunt and the Missouri Department of Labor and Industrial Relations’ Division of Workers’ Compensation announced the state is reducing the tax burden on Missouri job creators and employers.

In 2009, Missouri employers can expect a 50 percent reduction in the administrative tax placed on workers’ compensation insurance premiums, and the workers’ comp surcharge placed on deductible plan policyholders. The rates will be reduced from 1 percent to 0.5 percent in 2009. The Second Injury Fund surcharge will remain at 3 percent for calendar year 2009.

In addition to the tax reduction announced, a September filing by the National Council on Compensation Insurance indicated that workers’ comp rates in Missouri are expected to decrease for the year. The report anticipates the state could see an approximate 7.7 percent reduction in workers’ comp insurance rates beginning in January 2009. The change will further help attract and retain more jobs and provide more opportunities for Missouri workers.

Under Missouri law, the state is statutorily required to assess a workers’ comp tax/surcharge by Oct. 31 of each year for the following calendar year, and a Second Injury Fund surcharge. Revenue derived from the workers’ comp tax/surcharge is used to fund expenses associated with administering the workers’ comp program. The revenue generated by the Second Injury Fund surcharge is used to pay benefits to injured workers who had previous disabilities.

Gov. Blunt’s workers’ comp reform measures enacted in 2005 are reportedly helping to decrease workers’ comp rates in the state. The law restored fairness to Missouri’s workers’ comp system by protecting rights of injured workers without threatening Missouri jobs.