PRINTER'S NO. 1825
No. 1393 Session of 2000
INTRODUCED BY THOMPSON, HOLL, DENT, WENGER, TILGHMAN, KUKOVICH,
MUSTO, HART, GERLACH, WHITE, CORMAN, MOWERY, SLOCUM, ROBBINS,
BOSCOLA, HELFRICK AND STAPLETON, MARCH 22, 2000
REFERRED TO FINANCE, MARCH 22, 2000
AN ACT
1 Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2 act relating to tax reform and State taxation by codifying
3 and enumerating certain subjects of taxation and imposing
4 taxes thereon; providing procedures for the payment,
5 collection, administration and enforcement thereof; providing
6 for tax credits in certain cases; conferring powers and
7 imposing duties upon the Department of Revenue, certain
8 employers, fiduciaries, individuals, persons, corporations
9 and other entities; prescribing crimes, offenses and
10 penalties," further providing for insurance premiums tax and
11 for credits for assessments paid to the Pennsylvania Property
12 and Casualty Insurance Guaranty Association.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. Section 901 of the act of March 4, 1971 (P.L.6,
16 No.2), known as the Tax Reform Code of 1971, is amended by
17 adding definitions to read:
18 Section 901. Definitions.--The following terms, when used in
19 this act, shall have the meaning ascribed to them in this
20 section:
21 * * *
22 (4) "Assessment" means an assessment imposed by the Guaranty
1 Association pursuant to section 1808 of the act of May 17, 1921
2 (P.L.682, No.284), known as "The Insurance Company Law of 1921."
3 (5) "Guaranty Association" means the Pennsylvania Property
4 and Casualty Insurance Guaranty Association created pursuant to
5 section 1803 of the act of May 17, 1921 (P.L.682, No.284), known
6 as "The Insurance Company Law of 1921."
7 (6) "Member insurer" means an insurance company which
8 participates in the Guaranty Association.
9 Section 2. The act is amended by adding a section to read:
10 Section 902.1. Credits for Assessments Paid.--(a)
11 Calculation of credit.--A member insurer which has paid
12 assessments to the Guaranty Association may offset the
13 assessments against its premium tax liability to the extent of
14 twenty per cent of the amount of such assessment for each of the
15 five calendar years following the year in which such assessment
16 was paid. In the event a member insurer should cease doing
17 business, all uncredited assessments may be credited against its
18 premium tax liability for the year it ceases doing business.
19 (b) Refund of Assessments.--Any sums which are acquired by
20 refund from the Guaranty Association by member insurers, and
21 which have theretofore been offset against premium taxes as
22 provided in this section and are not then needed for the
23 purposes of the Guaranty Association, shall be paid by such
24 insurers to the Commonwealth in such manner as the department
25 may require. The Guaranty Association shall notify the Insurance
26 Commissioner that such refunds have been made.
27 (c) Limitation on Use of Credits.--No offset against premium
28 tax liability shall be permitted to the extent that a member
29 insurer's rates and premiums have been adjusted as permitted in
30 section 1810 of the act of May 17, 1921 (P.L.682, No.284), known
20000S1393B1825 - 2 -
1 as "The Insurance Company Law of 1921."
2 (d) Appropriation.--The credits allowed by this section
3 shall not reduce the amounts which would otherwise be payable
4 for firemen's relief pension or retirement purposes or for
5 police pension, retirement or disability purposes. The General
6 Assembly shall annually appropriate from the General Fund an
7 amount equal to the credits taken under this section by foreign
8 fire and casualty insurance companies.
9 (e) Retaliatory Taxes.--Credits taken by an insurer under
10 this section shall not be included in determining liability for
11 retaliatory taxes imposed under section 212 of "The Insurance
12 Company Law of 1921."
13 Section 3. This act shall apply to assessments paid on or
14 after January 1, 1999, and to taxes paid for calendar year 2000
15 and thereafter.
16 Section 4. This act shall take effect July 1, 2000.
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