83R10347 TJS-F
By: Eiland H.B. No. 2717
A BILL TO BE ENTITLED
AN ACT
relating to an insurer that establishes or significantly expands
physical operations in this state; authorizing a premium tax
credit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle B, Title 3, Insurance Code, is amended
by adding Chapter 230 to read as follows:
CHAPTER 230. PREMIUM TAX CREDIT FOR ESTABLISHING OR EXPANDING
OPERATIONS IN THIS STATE
Sec. 230.001. TAX CREDIT. The commissioner, with the
concurrence of the comptroller, may award a premium tax credit to an
insurer or other person with premium tax liability under this code,
as provided by this chapter, on determination that:
(1) the insurer has established or significantly
expanded physical operations in this state; and
(2) the establishment or expansion of operations
described by Subdivision (1) has produced a significant economic
benefit to this state in the taxable year during which the
establishment or expansion occurred.
Sec. 230.002. APPLICABLE TAXES. The tax credit under this
chapter may be applied to premium tax liability under Chapter 221,
222, 223, 224, or 225.
Sec. 230.003. APPLICATION. (a) To receive a premium tax
credit under this chapter, an insurer must, not earlier than the
12th month before or later than the 12th month after the activity
that is the basis of the insurer's eligibility for the credit,
submit an application to the commissioner and to the comptroller
detailing the insurer's establishment or significant expansion of
physical operations in this state, or the insurer's plan to
establish or expand operations in this state, as applicable, that
includes information demonstrating that taxes, fees, and other
sources of revenue to the state associated with the establishment
or expansion will more than offset foregone premium tax revenue
under this chapter. The application must include information about
the new or expanded operations, including:
(1) the number of new employees hired in this state;
(2) the purchase price or leasing costs, as
applicable, of properties located in this state;
(3) the cost of improvements made to real property
used in the operation of the business in this state;
(4) the anticipated wages paid to residents;
(5) an estimate of all new tax revenues to be paid to
the state or a political subdivision;
(6) other economic benefits to the state directly
related to the new or expanded physical operations; and
(7) any other evidence to be considered in determining
whether to allow the premium tax credit.
(b) The commissioner may approve an application under this
section only by an order that contains findings related to the net
anticipated benefit to the state. The order may contain terms that
limit or modify the insurer's plan or that condition the allowance
of tax credits on certain subsequent events.
(c) An insurer that receives a premium tax credit under this
chapter must submit to the commissioner annual filings that provide
evidence of the insurer's compliance with any conditions provided
by the order allowing the credit.
Sec. 230.004. AMOUNT OF PREMIUM TAX CREDIT. (a) An insurer
may apply for a premium tax credit under this chapter in an amount
not to exceed 100 percent of an investment directly related to the
establishment or significant expansion of physical operations in
this state.
(b) The credit against state premium tax liability of an
insurer in any one year may not exceed the state premium tax
liability of the insurer for that taxable year.
Sec. 230.005. TIME PERIOD; LIMITS. (a) If the commissioner
finds that an insurer qualifies for a premium tax credit under this
chapter, the commissioner may issue an order granting the credit in
the amount allowed under Section 230.004 for the taxable year in
which the premium tax credit was granted.
(b) The commissioner may grant to an insurer the premium tax
credit allowed under this chapter for not more than eight taxable
years.
(c) Any unused premium tax credit granted for a taxable year
under this chapter may be carried forward by an insurer against
state premium tax liability for not more than seven years.
Sec. 230.006. RECAPTURE AND FORFEITURE OF TAX CREDIT. If
the commissioner determines that an insurer has failed to comply
with a condition of the order issued under Section 230.003, the
commissioner, after notice and an opportunity for hearing, shall
issue an order requiring:
(1) the recapture of the premium tax credits
previously claimed by the insurer; and
(2) the forfeiture by the insurer of future premium
tax credits under this chapter.
Sec. 230.007. RULES; FORMS. The commissioner shall adopt
rules and forms as necessary to implement this chapter.
SECTION 2. As soon as practicable after the effective date
of this Act, the commissioner of insurance shall adopt rules and
forms as required by Section 230.007, Insurance Code, as added by
this Act.
SECTION 3. This Act takes effect September 1, 2013.