Current StatusView additional legislative information at the LPITS web site.Bill Number: 816 Ratification Number: 418 Act Number 368 Introducing Body: Senate Subject: Two percent graded premium tax on foreign life insurance companies
(A368, R418, S816)
AN ACT TO AMEND SECTIONS 38-5-320, 38-5-330, 38-5-340, 38-5-350, 38-5-360, 38-5-380, 38-5-390, 38-5-410, 38-5-420 AND 38-5-430, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE GRADED LICENSE FEES REQUIRED OF FOREIGN INSURANCE COMPANIES, SO AS TO CHANGE THE REFERENCES IN SUCH SECTIONS FROM LICENSE FEE TO INSURANCE PREMIUM TAX.
Be it enacted by the General Assembly of the State of South Carolina:
Two percent graded premium tax on foreign life insurance companies
Section 1. Section 38-5-320 of the 1976 Code is amended to read:
"Section 38-5-320. In addition to other annual license fees provided by law the Commissioner shall require each life insurance company of any class licensed by him, not incorporated under the laws of this State to pay as an additional and graded insurance premium tax an amount equal to two per cent on the total premiums, that is, total premium income or total premium receipts from the State, less any dividend or bonuses paid in cash or applied in abatement of premiums or credited to policyholders of such company as collected from citizens of or residents of this State during the time the company has done business in this State since making the last return for such insurance premium tax. For the purposes of this section premiums shall not include considerations received for annuity contracts."
Reduction of graded premium tax
Section 2. Section 38-5-330 of the 1976 Code is amended to read:
"Section 38-5-330. If the executive officer making a return for a company required to pay the additional tax provided by Section 38-5-320 shall file with the Commissioner a sworn statement showing that at least one-fourth of the reserve on all policies issued in this State is invested in any or all of the following securities or property, to wit: (a) notes or bonds of this State or of counties or municipalities of this State or subdivisions thereof, (b) notes or bonds secured by first mortgages on real estate in this State, (c) bonds of solvent domestic corporations or of solvent corporations domesticated in this State, secured by first mortgages on improved property located wholly in this State, (d) notes or debentures of corporations (foreign or domestic) where the entire proceeds (except costs and expenses incident to the financing of such notes or debentures) are to be expended for industrial facilities in this State, the fact of such expenditures to be established to the satisfaction of the Commissioner under such regulations as he may prescribe, (e) average daily balance on deposits in banks of this State, maintained continuously for twelve months next preceding the date of the return or average daily balance invested in savings accounts in building and loan, savings and loan, and federal savings and loan associations of this State, maintained continuously for twelve months next preceding the date of the return or (f) any property situate within the State and returned for taxes therein, at the value at which it is assessed for taxation, then the additional insurance premium tax on premiums collected during the time such investments have been actually made and maintained shall be one and three-fourths percent. Under like conditions if such investment be one-half of such reserve, the additional insurance premium tax shall be one and one-half percent. Under like conditions if such investment be three-fourths of such reserve, the additional insurance premium tax shall be one and one-fourth percent. And if the entire reserve be so invested, under like conditions the additional insurance premium tax on such premium receipts shall be one percent."
Two percent,graded premium tax on other foreign companies
Section 3. Section 38-5-340 of the 1976 Code is amended to read:
"Section 38-5-340. In addition to other annual license fees provided by law, the Commissioner shall require each foreign fire insurance company, each foreign accident and health insurance company, each foreign casualty or surety company and all other companies of any class licensed by him and not incorporated under the laws of this State, not herein before specifically mentioned, to pay as an additional and graded insurance premium tax an amount equal to two per cent on-the total-premiums, that is, total income of total receipts from the State, less return premiums on risks and less dividends paid or credited to policyholders in this State during the time the company has done business in this State since making the last return for such insurance premium tax."
Reduction of graded premium tag on other companies.
Section 4. Section 38-5-350 of the 1976 Code is amended to read:
"Section 38-5-350. If the executive officer making a return for a company required to pay the additional insurance premium tax provided by Section 38-5-340 shall file with the Commissioner a sworn statement showing that at least one-fourth of the premium receipts on all risks in this State is invested in the securities named in Section 38-5-330, then the additional insurance premium tax on premiums collected during the time such investments have been actually made and maintained shall be one and three-fourths percent. Under like conditions if such investments be one-half of such premium receipts, the additional insurance premium tax shall be one and one-half percent. Under like conditions if the investments shall be three-fourths of such premium receipts, the additional insurance premium tax shall be one and one-fourth percent. And if the entire premium receipts be so invested under like conditions, the additional insurance premium tax on such premium receipts shall be one percent."
Portion of graded taxes distributed to counties
Section 5. Section 38-5-360 of the 1976 Code is amended to read:
"Section 38-5-360. One-half of the additional insurance premium taxes collected under the terms of Sections 38-5-320 to 38-5-350 is allotted to the several counties, respectively, in proportion to the latest federal decennial census of such counties and is hereby appropriated to ordinary county purposes. No county license fee or tax shall be levied on such companies. At the dose of the annual period, or as soon thereafter as possible, the State Treasurer, upon a warrant from the Comptroller General, shall pay to the county treasurer of each county one-half of the additional insurance premium tax collected as aforesaid."
One percent graduated tax on foreign insurance companies
Section 6. Section 38-5-380 of the 1976 Code is amended to read:
"Section 38-5-380. The Commissioner shall require all insurance companies not incorporated under the laws of this State but doing business in this State, including all domesticated companies and all other companies of any class licensed by such Commissioner other than domestic companies, to pay, in addition to the annual license fees otherwise provided by law, an insurance premium tax in an amount equal to one per cent of the total premiums collected in thee State, less return premiums on risks and less dividends paid or credited to policyholders. But a mutual fire insurance company of another state, admitted to do business in this State, employing no agents, writing no business except on the property of its members and doing business without profit, shall pay annually on or before the first day of March, in lieu of the fee provided for in the preceding sentence but in addition to all other license fees which it is required by law to pay, an annual insurance premium tax in an amount equal to one per cent of the premiums and premium deposits and assessments collected by it in the State during the year ending on the thirty-first day of December next preceding, after deducting from such premiums and premium deposits and assessments the so-called dividends or unused or unabsorbed portion of the premiums and premium deposits and assessments applied or credited in part payment of such premiums or' premium deposits and assessments or returned to policyholders in cash or otherwise during the year for which the tax is computed. For the purposes of this section premiums shall not include considerations received for annuity contracts.
Disposition of graduated eases
Section 7. Section 38-5-390 of the 1976 Code is amended to read:
"Section 38-5-390. The one percent tax as provided for in Section 38-5-380 shall be paid into the State Treasury for use for State purposes, and the Commissioner shall collect such taxes as other taxes and fees are collected and pay them over to the State Treasurer."
Two percent graded premium tag on domestic companies
Section 8. Section 38-5-410 of the 1976 Code is amended to read:
"Section 38-5-410. In addition to any and all other license fees or taxes there is hereby imposed upon each domestic life insurance company of any class licensed by the Commissioner and incorporated under the laws of this State, an additional and graded insurance premium tax in an amount equal to two per cent of the total premiums, that is, total premium income or total premium receipts, from insurance contracts issued to residents of this State or paid from a point located within this State, less any dividends or bonuses paid in cash or applied in abatement of premiums or credited to policyholders of such company, as collected from citizens of or residents of this State during the year next preceding the date of the return. Such premiums shall not include considerations received from annuity contracts. The additional and graded insurance premium tax imposed in this section shall not exceed five per cent of the net income of the company as determined under the provisions of Chapter 7 of Title 12; provided, that in addition to the deductions allowed by such chapter there shall be allowed in computing net income any addition to policy reserves as may be required by the Commissioner, but no more than such required amount.
Two percent graded premium tax on other domestic companies
Section 9. Section 38-5-420 of the 1976 Code is amended to
read:
"Section 38-5-420. In addition to any and all other license fees or taxes there is hereby levied upon each domestic fire insurance company, each domestic accident and health insurance company, each domestic casualty or surety company and all other domestic insurance companies of any class, licensed by the Commissioner and incorporated under the laws of this State not specifically mentioned in Section 38-5-410 or this section an additional and graded insurance premium tax in an amount equal to two percent of the total premiums, that is, total premium income or total premium receipts from insurance contracts issued to residents of this State or paid from a point located within this State, less return premiums on risks and less dividends paid or credited to policyholders in this State during the year next preceding the date of the return. The additional and graded insurance premium tax imposed in this section shall not exceed five percent of the actual net income as determined under the provisions of Chapter 7 of Title 12; provided, that in addition to the deductions allowed by such chapter there shall be allowed in computing net income any addition to unearned premium reserves as may be required by the Commissioner, but no more than such amount required."
Administration and collection of tax
Section 10. Section 38-5-430 of the 1976 Code is amended to read:
"Section 38-5-430. The additional insurance premium taxes provided for in Sections 38-5-410 and 38-5-420 shall be administered and collected by the South Carolina Tax Commission. The Tax Commission may make such regulations, not inconsistent with law, necessary for the proper administration and collection of taxes imposed in such sections, and such regulations shall have full force and effect of law."
Time effective
Section 11. This act shall take effect January 1, 1981. Approved the 22nd day of April, 1980.