Provides for the disposition of the taxes collected on certain surplus lines of insurance (RE1 -$15,100,000 GF RV See Note)
Impact
The financial implications of HB 361 are notable, as the amended tax distribution aims to support fire safety initiatives through dedicated funding to the Fire Marshal and insurance funds. By adjusting the percentages of the tax collected, the bill will impact budgetary allocations within the state government, potentially enhancing the state's capacity to handle fire-related emergencies and insurance matters. This change reflects a broader approach to ensure that funds generated from insurance premiums are directed to areas that require financial reinforcement.
Summary
House Bill 361, introduced by Representative Jordan, addresses the allocation of taxes collected on surplus lines of insurance in Louisiana. Under current law, a tax of 4.85% is levied on the gross premium for surplus lines of insurance when Louisiana is the home state of the policyholder, with all proceeds going to the state general fund. The proposed changes seek to allocate the proceeds of this tax to multiple funds, redistributing a portion to the Fire Marshal Fund and the Two Percent Fire Insurance Fund, while still maintaining a significant portion for the state general fund.
Sentiment
The sentiment surrounding HB 361 appears largely favorable among legislators, as evidenced by the unanimous support it received during the House vote, where 100 legislators voted in favor and none opposed the bill. This overwhelming support indicate a consensus regarding the importance of appropriately distributing tax revenues to facilitate public safety and local support structures. The bill was considered straightforward in its intentions; however, there could be underlying concerns from stakeholders regarding the long-term impacts on the state general fund.
Contention
While discussions around the bill have not highlighted significant points of contention, the modification to tax allocations from surplus lines raises questions about its longer-term implications for funding within the state budget and how it may affect future budgetary priorities. The redistribution of funds from the general fund to specific niches could potentially lead to debates about resource allocation in future legislative sessions, particularly if the financial needs of these funds grow or if state budget constraints become a pressing issue.