Bill Summary for S 476 (2013-2014)

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Summary date: 

May 1 2013

Bill Information:

View NCGA Bill Details2013-2014 Session
Senate Bill 476 (Public) Filed Wednesday, March 27, 2013
Intro. by Meredith, Apodaca.

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Bill summary

Senatecommittee substitutemakes the following changes to the 2nd edition.

Deletes all the provisions of new GS 58-10-455, which set out the premium tax rates for captive insurance companies and established the Captive Insurance Regulatory Fund. Instead, provides that a captive insurance company is taxed in accordance with Article 8B of GS Chapter 105. Makes a conforming change, deleting subsection (c) of proposed GS 58-10-485, which required any monetary penalties collected under this section to be deposited into the Captive Insurance Regulatory Fund created in GS 58-10-455(f). Amends GS 105-228.3 to add captive insurance company as defined in GS 58-10-340 to the list of definitions that apply in Article 8B, Taxes Upon Insurance Companies, in GS Chapter 105.

Enacts new GS 105-228.4A in Article 8B of GS Chapter 105 to provide for the levy of taxes on captive insurance companies. Excludes a captive insurance company subject to the tax levied under this section from the franchise or income taxes imposed by Articles 3 and 4 of this Chapter and from the regulatory charge imposed by GS 58-6-25. Provides that the tax on captive insurance companies is collected and administered in the same manner as the gross premiums tax imposed under GS 105-228.5, except as otherwise provided in this section. Also provides that the definitions in new GS 58-10-340 apply in this section. Provides criteria for determining the tax base for a captive insurance company doing business in this state. Specifies the tax rate to be applied to gross premiums collected on reinsurance contracts issued by a captive insurance company under new GS 58-10-445. Also specifies the rate of tax on reinsurance andother insurance contracts issued by a captive insurance company. Establishes the parameters of total tax liability under this section and provides that two or more captive insurance companies commonly owned and controlled are taxed as a single captive insurance company under this section. Amends GS 105-228.5(g) to exempt captive insurance companies that are taxed under GS 105-228.4A from the provisions of GS 105-228.5 regarding taxes measured by gross premiums.

Amends GS 58-6-25 to exempt a captive insurance company from the insurance regulatory charge imposed by this section. Amends subsection (d) of this section to include expensesin regulatingand promoting the state's captive insurance industry as reimbursable to the General Fund from money credited to the Insurance Regulatory Fund.

Renumbers the remaining sections of the act as needed.