BOISE, ID — Idaho employers are expected to see approximately $11 million in unemployment insurance tax savings in 2026 following a reduction in the state’s base unemployment insurance tax rate.
According to an announcement from the Governor’s Office, the base unemployment insurance tax rate will decrease by 7.5% in 2026 compared to 2025. The reduction lowers the base rate to 0.729%, which state officials say is the second-lowest rate recorded since 1980.
The unemployment insurance tax is paid by employers to fund benefits for workers who lose their jobs. State officials estimate the rate decrease will result in roughly $11 million in savings for Idaho businesses statewide.
While the tax rate is decreasing, the taxable wage base — the maximum amount of an employee’s wages subject to the unemployment insurance tax — will increase from $55,300 to $58,300 in 2026.
The unemployment insurance tax rate for new employers will remain at 1.0%, which is the lowest rate allowed under federal conformity requirements.
State officials said employers will receive notification letters outlining their individual unemployment tax rates within the next week. Additional details, including the full 2026 tax rate schedules, are available through the Idaho Department of Labor.
