Bill Text: IL HB3078 | 2017-2018 | 100th General Assembly | Introduced

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Bill Title: Creates the Insurance Premium Tax Act. Imposes a tax on each authorized domestic, foreign, or alien insurer engaged in the business of entering into contracts of insurance or annuity in the State in an amount equal to 1.3% of the premiums and fees charged for those insurance policies. Provides that the proceeds from the tax shall be deposited into the Flood Catastrophe Fund and shall be used by the Department of Insurance for the purpose of providing reimbursement to insurers for a portion of their catastrophic losses due to flooding. Amends the State Finance Act to create the Flood Catastrophe Fund. Effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2019-01-08 - Session Sine Die [HB3078 Detail]

Download: Illinois-2017-HB3078-Introduced.html

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100TH GENERAL ASSEMBLY State of Illinois 2017 and 2018 HB3078 Introduced , by Rep. Elizabeth Hernandez SYNOPSIS AS INTRODUCED:
New Act
30 ILCS 105/5.878 new
Creates the Insurance Premium Tax Act. Imposes a tax on each authorized domestic, foreign, or alien insurer engaged in the business of entering into contracts of insurance or annuity in the State in an amount equal to 1.3% of the premiums and fees charged for those insurance policies. Provides that the proceeds from the tax shall be deposited into the Flood Catastrophe Fund and shall be used by the Department of Insurance for the purpose of providing reimbursement to insurers for a portion of their catastrophic losses due to flooding. Amends the State Finance Act to create the Flood Catastrophe Fund. Effective immediately.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be cited as the
Insurance Premium Tax Act.
Section 5. Definitions. As used in this Act:
"Department" means the Department of Revenue.
"Person" means any natural individual, firm, partnership,
association, joint stock company, joint adventure, public or
private corporation, limited liability company, or a receiver,
executor, trustee, guardian or other representative appointed
by order of any court.
Section 10. Tax imposed.
(a) Beginning on July 1, 2015, a tax is imposed upon each
authorized domestic, foreign, or alien insurer engaged in the
business of entering into contracts of insurance or annuity in
this State. The tax shall be imposed at the rate of 1.3% of the
premiums and fees charged for the following:
(1) property or casualty insurance;
(2) title insurance;
(3) marine or other transportation insurance; and
(4) assessments, including membership fees, policy

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fees, and gross deposits received from subscribers to
reciprocal or interinsurance agreements.
The tax under this Section shall not be imposed on premiums
and fees charged for workers' compensation policies, accident
and health insurance policies, or medical malpractice
policies.
(b) Every person subject to the tax under subsection (a)
shall apply to the Department (upon a form prescribed and
furnished by the Department) for a certificate of registration
under this Act.
(c) The Department shall have full power to administer and
enforce this Act, to collect all taxes and penalties due
hereunder, to dispose of taxes and penalties so collected in
the manner hereinafter provided, and to determine all rights to
credit memoranda, arising on account of the erroneous payment
of tax or penalty hereunder.
(d) The tax imposed under this Act shall be in addition to
all other occupation, privilege, or insurance taxes imposed by
the State of Illinois or by any municipal corporation or
political subdivision thereof. Persons subject to the tax
imposed by this Act may reimburse themselves for their tax
liability under this Act by separately stating the amount of
the tax as an additional charge to consumers.
Section 15. Returns. On or before the twentieth day of each
calendar month, each person who is subject to the tax under

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this Act during the preceding calendar month shall file a
return with the Department, stating:
(1) the name of the taxpayer;
(2) the address of the taxpayer's principal place of
business;
(3) the amount of tax due;
(4) the signature of the taxpayer; and
(5) such other reasonable information as the
Department may require.
If a taxpayer fails to sign a return within 30 days after
the proper notice and demand for signature by the Department,
the return shall be considered valid and any amount shown to be
due on the return shall be deemed assessed.
The taxpayer shall remit the amount of the tax due to the
Department at the time the taxpayer files his or her return.
Section 20. Suspension or revocation of certificates of
registration. The Department may, after notice and a hearing as
provided herein, suspend or revoke the certificate of
registration of any person who violates any of the provisions
of this Act. Before suspension or revocation of a certificate
of registration, the Department shall, within 90 days after
non-compliance and at least 7 days prior to the date of the
hearing, give the person so accused notice in writing of the
charge against him or her, and on the date designated shall
conduct a hearing upon this matter. The lapse of such 90 day

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period shall not preclude the Department from conducting
suspension or revocation proceedings at a later date if
necessary. Any hearing held under this Section shall be
conducted by the Director of Revenue or by any officer or
employee of the Department designated, in writing, by the
Director of Revenue.
Upon the hearing of any such proceeding, the Director of
Revenue, or any officer or employee of the Department
designated, in writing, by the Director of Revenue, may
administer oaths and the Department may procure by its subpoena
the attendance of witnesses and, by its subpoena duces tecum,
the production of relevant books and papers. Any circuit court,
upon application either of the accused or of the Department,
may, by order duly entered, require the attendance of witnesses
and the production of relevant books and papers, before the
Department in any hearing relating to the suspension or
revocation of certificates of registration. Upon refusal or
neglect to obey the order of the court, the court may compel
obedience thereof by proceedings for contempt.
Section 25. Review of Department decisions. Any person
aggrieved by any decision of the Department under this Act may,
within 20 days after notice of such decision, protest and
request a hearing, whereupon the Department shall give notice
to such person of the time and place fixed for such hearing and
shall hold a hearing in conformity with the provisions of this

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Act and then issue its final administrative decision in the
matter to such person. In the absence of such a protest within
20 days, the Department's decision shall become final without
any further determination being made or notice given.
Section 30. Flood Catastrophe Fund. The proceeds of the tax
collected under this Act shall be deposited into the Flood
Catastrophe Fund, a special fund created in the State Treasury.
Moneys in the Flood Catastrophe Fund shall be used by the
Department of Insurance for the purpose of providing
reimbursement to insurers for a portion of their catastrophic
losses due to flooding.
Section 35. Rules. The Department may adopt rules related
to the enforcement of this Act.
Section 800. The State Finance Act is amended by adding
Section 5.878 as follows:
(30 ILCS 105/5.878 new)
Sec. 5.878. The Flood Catastrophe Fund.
Section 999. Effective date. This Act takes effect upon
becoming law.