Bill Summary for S 628 (2017-2018)

Summary date: 

Jun 12 2017
S.L. 2017-204

Bill Information:

View NCGA Bill Details2017-2018 Session
Senate Bill 628 (Public) Filed Tuesday, April 4, 2017
AN ACT TO MAKE VARIOUS CHANGES TO THE REVENUE LAWS.
Intro. by Tillman, Brock, Tucker.

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Bill summary

Senate amendment makes the following changes to the 2nd edition.

Amends GS 105-228.5(d)(3), setting forth an additional tax on property coverage contracts, to clarify that the additional tax imposed on property coverage contracts is a special purpose assessment based on gross premiums and not a gross premiums tax.

Provides the following clarifications: the gross premiums tax is a tax imposed on the gross premiums of insurers, Article 65 corporations, health maintenance organizations, and selfäóïinsurers; entities subject to the gross premiums tax are not subject to franchise or income taxes; and in SL 2009äóï548, the General Assembly broadened the taxes against which the business and energy tax credits could be taken from income and franchise taxes to income, franchise, and gross premiums taxes.

Further provides: that the gross premiums tax rate is set in GS 105äóï228.5(d)(1) and (2); separate and apart from the gross premiums taxes, GS 105äóï228.5(d)(3) imposes an additional tax that is calculated using a person's gross premiums but is not considered part of the gross premiums tax imposition; the Department of Revenue has historically administered the gross premiums tax and the additional tax imposed under GS 105äóï228.5 as two separate and distinct taxes and, satisfied with this administration, the General Assembly did not address the separate treatment of the two taxes in SL 2009äóï548; and it is the intent of this provision to further clarify for taxpayers the accuracy and to endorse the Department's interpretation of the current and continuing state of the law by expressly codifying the longäóïstanding interpretation of the additional tax imposed by GS 105äóï228.5(d)(3) as a separate and distinct tax that is based upon gross premiums but is not a gross premiums tax.

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