TWC Lowers Taxes for Texas Employers in 2023
Press Releases
Average unemployment insurance tax rate drops to 1.16%
AUSTIN – Today, the Texas Workforce Commission (TWC) announced the average unemployment insurance (UI) tax rate for all employers will be 1.16% for calendar year (CY) 2023. Last year, the average tax rate was 1.35%.
The minimum tax rate is paid by more than 370,000 employers, which represents 61.5% of experience-rated employers. The minimum UI tax rate paid by Texas employers in CY 2023 will be 0.23%, which is 0.08 percentage points lower than 0.31% in CY 2022. These employer-paid UI taxes replenish the Texas Unemployment Compensation Trust Fund, which provides temporary income for Texas workers who lose their jobs through no fault of their own.
An experience rating is determined by the amount of an employer’s taxable wages and the amount of UI benefits that have been paid to former employees and charged to the employer’s account for the last three years. An employer paying the standard minimum tax will pay $20.70 per employee in CY 2023 on the first $9,000 in wages per employee compared with $27.90 per employee in CY 2022. The average tax rate for experience-rated employers is 0.89%. The maximum UI tax rate, paid by 4.2% of Texas employers, will be 6.23%, down 0.08 percentage points from CY 2022 at 6.31%.
TWC is dedicated to finding ways to lower the financial impact of UI taxes on Texas employers. TWC and the state’s 28 local workforce boards are also committed to helping UI claimants return to work as soon as possible. Because the Texas Unemployment Compensation Trust Fund has risen above its statutory minimum required balance, TWC will not charge employers any deficit tax in 2023. More information about the components of the tax rate are on TWC’s website.
| UI tax rates for Texas employers from calendar years 2003 to 2023. | |||||
|---|---|---|---|---|---|
| Year | Taxable Wage Base | Minimum Tax Rate | Maximum Tax Rate | Average Tax Rate | Average Experience Tax Rate |
| 2023 | $9,000 | 0.23% | 6.23% | 1.16% | 0.89% |
| 2022 | $9,000 | 0.31% | 6.31% | 1.35% | 1.13% |
| 2021 | $9,000 | 0.31% | 6.31% | 1.42% | 1.13% |
| 2020 | $9,000 | 0.31% | 6.31% | 1.14% | 0.93% |
| 2019 | $9,000 | 0.36% | 6.36% | 1.25% | 1.06% |
| 2018 | $9,000 | 0.46% | 6.46% | 1.37% | 1.20% |
| 2017 | $9,000 | 0.59% | 8.21% | 1.64% | 1.51% |
| 2016 | $9,000 | 0.45% | 7.47% | 1.46% | 1.30% |
| 2015 | $9,000 | 0.47% | 7.49% | 1.54% | 1.40% |
| 2014 | $9,000 | 0.51% | 7.41% | 1.66% | 1.54% |
| 2013 | $9,000 | 0.54% | 7.35% | 1.82% | 1.71% |
| 2012 | $9,000 | 0.61% | 7.58% | 1.96% | 1.87% |
| 2011 | $9,000 | 0.78% | 8.25% | 2.03% | 1.96% |
| 2010 | $9,000 | 0.72% | 8.60% | 1.83% | 1.74% |
| 2009 | $9,000 | 0.26% | 6.26% | 0.99% | 0.78% |
| 2008 | $9,000 | 0.10% | 6.10% | 0.92% | 0.65% |
| 2007 | $9,000 | 0.29% | 7.70% | 1.30% | 1.13% |
| 2006 | $9,000 | 0.40% | 7.64% | 1.51% | 1.37% |
| 2005 | $9,000 | 0.58% | 8.02% | 1.74% | 1.63% |
| 2004 | $9,000 | 0.67% | 8.26% | 1.74% | 1.64% |
| 2003 | $9,000 | 0.67% | 8.47% | 1.68% | 1.56% |
Wages often can be the largest portion of expenses for a business. As Texas business owners begin staffing plans for the next year, TWC invites businesses to access data from its annual Occupational Wage Survey, which can provide valuable insights on competitive wages for all types of positions for any area in Texas. Information gathered in the survey is confidential and is reported from Texas employers who participate in the survey. For more information or to participate and assist in making Texas more competitive in the labor marketplace, please contact us by emailing oesinfo@twc.texas.gov or by calling 800-252-3616.
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Texas Workforce Commission is a state agency dedicated to helping Texas employers, workers, and communities prosper economically. For details on TWC and its services in coordination with its local workforce development boards network, call 800-628-5115 or visit https://twc.texas.gov/. Subscribe to email updates to receive notifications about TWC programs and services.