Connecticut Senate Bill SB01046

Connecticut 2013 Regular Session

• Introduced: 3/4/13
• Refer: 3/4/13
• Report Pass: 4/4/13
• Refer: 4/9/13
• Report Pass: 4/16/13
• Refer: 4/24/13
• Report Pass: 5/1/13

Caption

An Act Concerning Insurance Tax Provisions.

Impact

The legislation proposes changes to sections of the taxation code that will affect how captive insurance companies compute their tax liabilities. Specifically, it substitutes tax rates for net premiums based on predetermined thresholds, potentially benefiting smaller captive insurers by providing a more favorable tax structure. This could encourage the establishment and growth of captive insurance companies within the state, aligning the tax structure with the operational realities of these businesses.

Summary

SB01046, titled 'An Act Concerning Insurance Tax Provisions', was introduced to update the taxation framework for captive insurance companies in the state. The primary focus of the bill is to adjust the tax rates applicable to premiums collected by these companies and to streamline the process for estimated tax payments. The adjustments are designed to provide clarity and enhance the procedural efficiency related to premium tax collection.

Sentiment

The general sentiment around SB01046 appears to be positive, especially among the proponents of the insurance industry who see the revisions as a necessary step to modernize and improve the business environment for captive insurers. However, there may be concerns regarding the potential impact on state revenue, as the adjustments could lead to reduced tax income from these entities if the new rates are more favorable than the existing ones.

Contention

Notable points of contention regarding SB01046 could arise around the impacts of tax exemptions and the overall effect on state revenue. Detractors may argue that while the bill seeks to foster economic growth through a more favorable tax environment for insurance companies, it could undermine the state’s ability to maintain consistent funding for public services dependent on tax revenues. Balancing the interests of business growth while ensuring adequate state funding will be critical in the discussions surrounding this bill.