Bill Text: TX HB3630 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Relating to an insurance premium tax credit for investment in certain communities.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-03-30 - Referred to Ways & Means [HB3630 Detail]
Download: Texas-2017-HB3630-Introduced.html
| 85R13314 BEF-F | ||
| By: Lucio III | H.B. No. 3630 | |
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| relating to an insurance premium tax credit for investment in | ||
| certain communities. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Subtitle B, Title 3, Insurance Code, is amended | ||
| by adding Chapter 231 to read as follows: | ||
| CHAPTER 231. PREMIUM TAX CREDIT FOR INVESTMENT IN CERTAIN | ||
| COMMUNITIES | ||
| Sec. 231.001. GENERAL DEFINITIONS. In this chapter: | ||
| (1) "Internal Revenue Code" means the Internal Revenue | ||
| Code of 1986 in effect on September 1, 2017, excluding any changes | ||
| made by federal law after that date, but including any regulations | ||
| adopted under that code that are applicable to the tax year to which | ||
| the provisions of the code in effect on that date applied. | ||
| (2) "State premium tax liability" means any premium | ||
| tax liability incurred under Chapter 221, 222, 223, 223A, or 224. | ||
| (3) "Low-income community," "qualified equity | ||
| investment," and "qualified low-income community investment" have | ||
| the meanings assigned by Section 45D, Internal Revenue Code. | ||
| Sec. 231.002. DEFINITION: QUALIFIED COMMUNITY DEVELOPMENT | ||
| ENTITY. In this chapter, "qualified community development entity" | ||
| has the meaning assigned by Section 45D, Internal Revenue Code, | ||
| provided that the entity has entered into, for the current year or a | ||
| prior year with an allocation effective date on or after July 1, | ||
| 2015, an allocation agreement with the Community Development | ||
| Financial Institutions Fund of the United States Department of the | ||
| Treasury with respect to credits authorized by Section 45D, | ||
| Internal Revenue Code, that includes this state in the service area | ||
| specified in the allocation agreement. The term includes a | ||
| qualified community development entity that is controlled by or | ||
| under common control with another qualified community development | ||
| entity described by this section. | ||
| Sec. 231.003. RULES ESTABLISHING CREDIT. (a) The | ||
| comptroller, in consultation with the Texas Workforce Commission, | ||
| by rule shall establish a credit against state premium tax | ||
| liability for entities that make qualified equity investments in | ||
| qualified community development entities in this state. The rules | ||
| must comply with this section. | ||
| (b) The purpose of the credit is to promote new job | ||
| creation, job retention, and capital investment in economically | ||
| distressed and low-income communities. | ||
| (c) Available credits must be allocated so that an equal | ||
| amount of credits are available in connection with qualified | ||
| low-income community investments in: | ||
| (1) rural communities; | ||
| (2) seaports; | ||
| (3) educational institutions that provide | ||
| prekindergarten, primary education, secondary education, higher | ||
| education, and workforce skills training; and | ||
| (4) distressed metropolitan communities throughout | ||
| the state. | ||
| (d) The amount of the credit in connection with a qualified | ||
| equity investment may not exceed 39 percent of the purchase price of | ||
| the investment. An entity must be able to claim the entire amount of | ||
| the credit in connection with an investment not later than the | ||
| seventh anniversary of the date the investment is made. | ||
| (e) A qualified community development entity must place a | ||
| refundable deposit of at least $500,000 with the state during the | ||
| period in which tax credits may be claimed in connection with | ||
| qualified equity investments in the entity. An entity that | ||
| violates rules under this section is subject to forfeiture of all or | ||
| part of the deposit. | ||
| (f) At least $300 million in credits must be made available. | ||
| Sec. 231.004. ELIGIBILITY FOR CREDIT. An entity is | ||
| eligible for a credit against the entity's state premium tax | ||
| liability in the amount and under the conditions and limitations | ||
| provided by rules adopted under Section 231.003. | ||
| Sec. 231.005. RETALIATORY TAX. An entity claiming a credit | ||
| under this chapter is not required to pay any additional | ||
| retaliatory tax levied under Chapter 281 as a result of claiming | ||
| that credit. | ||
| SECTION 2. As soon as practicable after this Act becomes law | ||
| for purposes of Section 2001.006, Government Code, the comptroller | ||
| shall adopt rules under Section 231.003, Insurance Code, as added | ||
| by this Act. | ||
| SECTION 3. This Act applies only to an insurance premium tax | ||
| report originally due on or after January 1, 2018. | ||
| SECTION 4. This Act takes effect immediately if it receives | ||
| a vote of two-thirds of all the members elected to each house, as | ||
| provided by Section 39, Article III, Texas Constitution. If this | ||
| Act does not receive the vote necessary for immediate effect, this | ||
| Act takes effect September 1, 2017. | ||
