Report Title:

Insurance Premium Tax

 

Description:

Changes the insurance premium tax rates for life insurance and ocean marine insurance contracts.

 

HOUSE OF REPRESENTATIVES

H.B. NO.

1748

TWENTY-FIFTH LEGISLATURE, 2009

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO INSURANCE PREMIUM TAXES.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Section 431:7-202, Hawaii Revised Statutes, is amended by amending subsections (b) and (c) to read as follows:

     "(b)  Each authorized insurer, with respect to life insurance contracts, shall pay to the director of finance through the commissioner a tax of [2.75] 4.265 per cent on the gross premiums received from all risks resident within this State, during the year ending on the preceding December 31, less return premiums, dividends paid or credited to policyholders, and reinsurance accepted (the tax upon such business being payable by the direct writing insurer).

     The tax also shall apply to premiums for insurance written on individuals residing outside the State unless the direct writing insurer shall show the payment of a comparable tax to another appropriate taxing authority.  Such showing may be required as to any premium written, procured, or received in the State.

     (c)  Each authorized insurer [shall], with respect to all ocean marine insurance contracts written within the State, during the year ending on the preceding December 31, shall pay to the director of finance through the commissioner a tax of [.8775] 4.265 per cent on its gross underwriting profit.  The gross underwriting profit shall be ascertained by deducting from the net premiums (i.e., gross premiums less all return premiums and premiums for reinsurance ceded) on such ocean marine insurance contracts, the net losses paid (i.e., gross losses paid less salvage and recoveries on reinsurance ceded) during such year under such contracts.  In the case of an insurer issuing participating contracts, the gross underwriting profit shall not include, for computation of the tax prescribed by this subsection, the amount refunded, or paid as participation dividends, by such insurer to the holders of such contracts."

     SECTION 2.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval and shall be repealed on December 31, 2015.

 

INTRODUCED BY:

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