Bill Text: CT SB00016 | 2010 | General Assembly | Comm Sub

Connecticut Senate Bill 16 (Prior Session Legislation)

Bill Title: An Act Phasing Out The Insurance Premium Tax For Municipalities.

Spectrum: Bipartisan Bill

Status: (Introduced - Dead) 2010-04-08 - Referred by Senate to Committee on Finance, Revenue and Bonding [SB00016 Detail]

Download: Connecticut-2010-SB00016-Comm_Sub.html

General Assembly		*Substitute Bill No. 16*
*February Session, 2010*		_____SB00016INS___021610____

AN ACT PHASING OUT THE INSURANCE PREMIUM TAX FOR MUNICIPALITIES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 12-202 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2010, and applicable to income years commencing on or after January 1, 2010):

(a) Each domestic insurance company shall, annually, pay a tax on the total net direct premiums received by such company during the calendar year next preceding from policies written on property or risks located or resident in this state. The rate of tax on all net direct insurance premiums received on and after January 1, 1995, shall be one and three-quarters per cent. The franchise tax imposed under this section on premium income for the privilege of doing business in the state is in addition to the tax imposed under chapter 208. In the case of any local domestic insurance company the admitted assets of which as of the end of an income year do not exceed ninety-five million dollars, eighty per cent of the tax paid by such company under chapter 208 during such income year reduced by any refunds of taxes paid by such company and granted under said chapter within such income year and eighty per cent of the assessment paid by such company under section 38a-48 during such income year shall be allowed as a credit in the determination of the tax under this chapter payable with respect to total net direct premiums received during such income year, provided that these two credits shall not reduce the tax under this chapter to less than zero, and provided further in the case of a local domestic insurance company which is a member of an insurance holding company system, as defined in section 38a-129, these credits shall apply if the total admitted assets of the local domestic insurance company and its affiliates, as defined in said section, do not exceed two hundred fifty million dollars or, in the alternative, in the case of a local domestic insurance company which is a member of an insurance holding company system, as defined in section 38a-129, these credits shall apply only if total direct written premiums are derived from policies issued or delivered in Connecticut, on risk located in Connecticut and, as of the end of the income year the company and its affiliates have admitted assets minus unpaid losses and loss adjustment expenses that are also discounted for federal and state tax purposes and which for said local domestic insurance company and its affiliates, as defined in said section do not exceed two hundred fifty million dollars.

(b) Notwithstanding the provisions of subsection (a) of this section, the rate of tax on net direct premiums for any contract or policy with a municipality to provide health care coverage to municipal employees, municipal retirees or dependents of such employees or retirees shall be:

(1) For the income years commencing on January 1, 2010, and January 1, 2011, one and three-tenths per cent;

(2) For the income year commencing on January 1, 2012, nine-tenths of one per cent; and

(3) For income years commencing on and after January 1, 2013, zero per cent.

Sec. 2. Section 12-202a of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2010, and applicable to income years commencing on or after January 1, 2010):

(a) Each health care center, as defined in section 38a-175, that is governed by sections 38a-175 to 38a-192, inclusive, shall pay a tax to the Commissioner of Revenue Services for the calendar year commencing on January 1, 1995, and annually thereafter, at the rate of one and three-quarters per cent of the total net direct subscriber charges received by such health care center during each such calendar year on any new or renewal contract or policy approved by the Insurance Commissioner under section 38a-183. Such payment shall be in addition to any other payment required under section 38a-48.

(b) Notwithstanding the provisions of subsection (a) of this section, the tax shall not apply to:

(1) Any new or renewal contract or policy entered into with the state on or after July 1, 1997, to provide health care coverage to state employees, retirees and their dependents;

(2) Any subscriber charges received from the federal government to provide coverage for Medicare patients;

(3) Any subscriber charges received under a contract or policy entered into with the state to provide health care coverage to Medicaid recipients under the Medicaid managed care program established pursuant to section 17b-28, which charges are attributable to a period on or after January 1, 1998;

(4) Any new or renewal contract or policy entered into with the state on or after April 1, 1998, to provide health care coverage to eligible beneficiaries under the HUSKY Medicaid Plan Part A, HUSKY Part B, or the HUSKY Plus programs, each as defined in section 17b-290;

(5) Any new or renewal contract or policy entered into with the state on or after April 1, 1998, to provide health care coverage to recipients of state-administered general assistance pursuant to section 17b-192;

(6) Any new or renewal contract or policy entered into with the state on or after February 1, 2000, to provide health care coverage to retired teachers, spouses or surviving spouses covered by plans offered by the state teachers' retirement system;

(7) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of a municipality and their dependents under a plan procured pursuant to section 5-259;

(8) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of nonprofit organizations and their dependents under a plan procured pursuant to section 5-259;

(9) Any new or renewal contract or policy entered into on or after July 1, 2003, to provide health care coverage to individuals eligible for a health coverage tax credit and their dependents under a plan procured pursuant to section 5-259;

(10) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to employees of community action agencies and their dependents under a plan procured pursuant to section 5-259; or

(11) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to retired members and their dependents under a plan procured pursuant to section 5-259.

(c) Notwithstanding the provisions of subsection (a) of this section, the rate of tax on net direct subscriber charges for any contract or policy with a municipality to provide health care coverage to municipal employees, municipal retirees or dependents of such employees or retirees shall be:

(1) For the income years commencing on January 1, 2010, and January 1, 2011, one and three-tenths per cent;

(2) For the income year commencing on January 1, 2012, nine-tenths of one per cent; and

(3) For income years commencing on and after January 1, 2013, zero per cent.

[(c)] (d) The provisions of this chapter pertaining to the filing of returns, declarations, installment payments, assessments and collection of taxes, penalties, administrative hearings and appeals imposed on domestic insurance companies shall apply with respect to the charge imposed under this section.


This act shall take effect as follows and shall amend the following sections:
Section 1	July 1, 2010, and applicable to income years commencing on or after January 1, 2010	12-202
Sec. 2	July 1, 2010, and applicable to income years commencing on or after January 1, 2010	12-202a