(The Center Square) – After failing to follow the law and overcharging thousands of New Mexico businesses on unemployment insurance taxes, the Department of Workforce Solutions (DWS) reviewed and recalculated tax rates for all employers.
More than 50,000 New Mexican employers’ rates were reviewed by the DWS resulting in approximately 9,000 of those having their rates reduced. During the recalculation, 2,000 were found to owe higher taxes, while the remainder garnered no change.
Last year, many New Mexico businesses were receiving notifications from the state that they owed sky-high unemployment insurance taxes.
Carla Sonntag, president and CEO of the New Mexico Business Coalition, said they were the ones to bring it to the state’s attention.
“We notified the Department of Workforce Solutions’ secretary that they were not following the law,” she told The Center Square. “He didn’t do anything to correct it, and now people were overpaying, and so we continued to escalate to the point where we took the complaint to the state auditor and attorney general.”
Within three days of the Coalition’s final complaint, then-secretary Bill McCamley resigned, Sonntag said.
Deputy Secretary Ricky Serna stepped in as acting secretary and immediately issued a notice to all businesses who received a rate increase stating they would have their rates recalculated.
Sonntag said this should never have happened because the new law enacted in July 2020 clearly stated employers were to be held harmless for layoffs resulting from the COVID-19 public health crisis and the government-imposed restrictions on businesses.
“Hopefully they’ve got that straightened out now going forward because at the end of this month they will again do rate calculations for next year,” she said.
Businesses that have already paid their incorrectly inflated rates can either apply for a refund or have their surplus payment credited to their next payment.
“It’s created a lot of extra work at a time that has been very, very challenging for New Mexico businesses,” Sonntag said.