Bill Text: CT SB00096 | 2012 | General Assembly | Introduced

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Bill Title: An Act Exempting Municipalities From The Health Insurance Premium Tax.

Spectrum: Committee Bill

Status: (Introduced - Dead) 2012-03-02 - Change of Reference, House to Committee on Finance, Revenue and Bonding [SB00096 Detail]

Download: Connecticut-2012-SB00096-Introduced.html

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General Assembly		Raised Bill No. 96
February Session, 2012		LCO No. 879
		*00879_______INS*
Referred to Committee on Insurance and Real Estate
Introduced by:
(INS)

AN ACT EXEMPTING MUNICIPALITIES FROM THE HEALTH INSURANCE PREMIUM TAX.

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 Section 12-202 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012):

(a) (1) 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,] first shall be one and three-quarters per cent.

(2) Notwithstanding the provisions of subdivision (1) of this subsection, on and after July 1, 2012, the tax shall not apply to any net direct health insurance premiums received by such company from a municipality in this state.

(b) 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.

(c) 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.

Sec. 2. Section 12-202a of the 2012 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012):

(a) Each health care center, as defined in section 38a-175, that is governed by sections 38a-175 to 38a-192, inclusive, shall, annually, pay a tax to the Commissioner of Revenue Services for the calendar year [commencing on January 1, 1995, and annually thereafter,] next preceding 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 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 Plan, Part A, HUSKY Plan, Part B, or 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 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;

(6) Any new or renewal contract or policy entered into on or after July 1, [2001] 2012, to provide health care coverage to employees of a municipality and their dependents; [under a plan procured pursuant to section 5-259;]

(7) 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;

(8) 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;

(9) 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

(10) 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) 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.

Sec. 3. Section 12-210 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2012):

(a) Each newly licensed insurance company incorporated by or organized under the laws of any other state or foreign government shall pay to the Commissioner of Revenue Services, [within] not later than forty-five days [of] after the effective date of such company's initial license to transact business in this state, a tax on the net direct premiums received by such company in the next five preceding calendar years from policies written on property or risks located or resident in this state, except ocean marine insurance and health insurance as specified in subdivision (c) of this section, at the rate in effect for each such calendar year.

(b) Each insurance company incorporated by or organized under the laws of any other state or foreign government and doing business in this state shall, annually, on and after January [1, 1995] first, pay to said Commissioner of Revenue Services, in addition to any other taxes imposed on such company or its agents, a tax of one and three-quarters per cent of all net direct premiums received by such company in the calendar year next preceding from policies written on property or risks located or resident in this state, excluding premiums for ocean marine insurance and health insurance as specified in subsection (c) of this section, and, upon ceasing to transact new business in this state, shall continue to pay a tax upon the renewal premiums derived from its business remaining in force in this state at the rate which was applicable when such company ceased to transact new business in this state.

(c) On and after July 1, 2012, the tax set forth in subsections (a) and (b) of this section shall not apply to any net direct health insurance premiums received by such company from a municipality in this state.

This act shall take effect as follows and shall amend the following sections:
Section 1	July 1, 2012	12-202
Sec. 2	July 1, 2012	12-202a
Sec. 3	July 1, 2012	12-210

Statement of Purpose:

To exempt health insurance premiums paid by a municipality from the insurance premiums tax.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]