HB3548 99TH GENERAL ASSEMBLY

LRB099 10228 HLH 30454 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3548

Introduced , by Rep. Elizabeth Hernandez

SYNOPSIS AS INTRODUCED:

New Act
30 ILCS 105/5.866 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.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

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;

(4) annuity premiums or considerations; and

(5) assessments, including membership fees, policy 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 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 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 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 5.866 as follows:

(30 ILCS 105/5.866 new)

Sec. 5.866. The Flood Catastrophe Fund.

Section 999. Effective date. This Act takes effect upon becoming law.