00CS FOR HOUSE BILL NO. 490(L&C)                                                                                        
01 "An Act relating to insurance premium taxes; and providing for an effective                                             
02 date."                                                                                                                  
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                               
04    * Section 1.  AS 21.09.210(b) is amended to read:                                                                  
05  (b)  Each insurer, and each formerly authorized insurer with respect to                                               
06 premiums received while an authorized insurer in this state, shall pay a tax on the total                               
07 direct premium income received during the year ending on the preceding December                                         
08 31 and paid for the insurance of property or risks resident or located in the state, other                              
09 than wet marine and transportation insurance, after deducting from the total direct                                     
10 premium income the applicable cancellations, returned premiums, the unabsorbed                                          
11 portion of any deposit premium, all policy dividends, unabsorbed premiums refunded                                      
12 to policyholders, refunds, savings, savings coupons, and other similar returns paid or                                  
13 credited to policyholders with respect to their policies.   Deductions  [NO                                           
14 DEDUCTIONS] may  not  be made of cash surrender value of policies.  Considerations                                    

01 received on annuity contracts are not included in the direct premium income and are                                     
02 not subject to tax.  The tax shall be paid to the director at least annually but not more                               
03 often than once each quarter on the dates specified by the director.  The method of                                     
04 payment must be by the electronic or other payment method specified by the director.                                    
05  Except as provided under (n) of this section, the  [THE] tax is computed at the rate                                 
06 of                                                                                                                      
07   (1)  for domestic and foreign insurers, except hospital and medical                                                  
08 service corporations, 2.7 percent;                                                                                      
09   (2)  for hospital and medical service corporations, six percent of their                                             
10 gross premiums less claims paid.                                                                                        
11    * Sec. 2.  AS 21.09.210(i) is amended to read:                                                                     
12  (i)  Premiums paid by the state  or a political subdivision of the state,                                            
13 premiums paid by employers who participate in the Public Employees' Retirement                                          
14 System of Alaska or in the Teacher's Retirement System of Alaska,  [FOR                                                
15 INSURANCE POLICIES] and  premiums paid under  contracts purchased under the                                           
16 provisions of AS 39.30 are exempt from taxation under this  chapter  [SECTION].  An                                   
17 insurer may not include the tax imposed under this section in a premium charged on                                      
18 an insurance policy or contract purchased by the state under the provisions of                                          
19 AS 39.30.  An insurer may claim the exemption on forms provided by the division of                                      
20 insurance.                                                                                                              
21    * Sec. 3.  AS 21.09.210 is amended by adding a new subsection to read:                                             
22  (n)  The tax imposed under this section shall be computed at the rate of                                              
23   (1)  one-tenth of a percent for a policy of life insurance with a policy                                             
24 year premium that equals or exceeds $100,000; and                                                                       
25   (2)  2.7 percent for a policy of life insurance with a policy year                                                   
26 premium below $100,000.                                                                                                 
27    * Sec. 4.  This Act takes effect immediately under AS 01.10.070(c).