May 7, 2009, Introduced by Senators SANBORN and RICHARDVILLE and referred to the Committee on Finance.
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending section 476a (MCL 500.476a), as amended by 2007 PA 187.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 476a. (1) Beginning August 3, 1987, whenever, by a law in
force outside of this state or country, a domestic insurer or agent
of a domestic insurer is required to make a deposit of securities
for the protection of policyholders or otherwise, or to make
payment for taxes, fines, penalties, certificates of authority,
valuation of policies, or otherwise, or a special burden or other
burden is imposed, greater in the aggregate than is required by the
laws of this state for a similar alien or foreign insurer or agent
of an alien or foreign insurer, the alien or foreign insurer of
that state or country is required, as a condition precedent to its
transacting business in this state, to make a like deposit for like
purposes with the state treasurer of this state, and to pay to the
revenue commissioner for taxes, fines, penalties, certificates of
authority, valuation of policies, and otherwise an amount equal in
the aggregate to the charges and payments imposed by the laws of
the other state or country upon a similar domestic insurer and the
agents of a domestic insurer, regardless of whether a domestic
insurer or agent of a domestic insurer is actually transacting
business in that state or country. For fire department or salvage
corps taxes or other local taxes the amount shall be computed by
the revenue commissioner by dividing the total of the payments made
by domestic insurers in that state or country by the gross premium
received by domestic insurers in that state or country less return
premiums. The commissioner shall revoke the certificate of
authority of an alien or foreign insurer refusing for 30 days to
make payment of fees or taxes as required by this chapter. Except
as provided in subsections (3) and (4), for purposes of this
section, an insurer organized under the laws of a state or country
other than these United States shall be considered an insurer of
the state in which its general deposit for the benefit of its
policyholders is made. For tax years that begin after December 31,
2008, an insurer or agent of an insurer may credit against the tax
imposed under this section an amount equal to the amount of the
credit the insurer or agent of an insurer would be eligible to
claim for a qualified equity investment during the respective tax
year under section 465 of the Michigan business tax act, 2007 PA
36, MCL 208.1465, if that insurer or agent was filing a return
under the Michigan business tax act, 2007 PA 36, MCL 208.1101 to
208.1601.
(2) The purpose of this section is to promote the interstate
business of domestic insurers by deterring other states from
enacting discriminatory or excessive taxes.
(3) Subsection (4) does not apply to a domestic insurer that
is owned or controlled, directly or indirectly, by an alien or
foreign insurer who prior to 1998 and with the commissioner's
approval did not keep books, records, and files or true copies
thereof in this state.
(4) For purposes of this section, the state treasurer, after
consultation with the commissioner, shall determine that a domestic
insurer is an alien or foreign insurer domiciled in a state or
country determined by the state treasurer if the insurer does not
comply with all of the following:
(a) Maintain its principal place of business in this state.
(b) Maintain in this state officers and personnel responsible
for and knowledgeable of the company's operation, books, records,
administration, and annual statement.
(c) Conduct in this state a substantial portion of its
underwriting, sales, claims, legal, and, if applicable, medical
operations relating to Michigan policyholders and certificate
holders.
(d) Comply with section 5256(1)(a) and (2) through (6). The
commissioner shall inform the state treasurer when a domestic
insurer is not in compliance with section 5256(1)(a) or (2) through
(6).
(5) Taxes collected pursuant to this section are subject to
section 22d of the former single business tax act, 1975 PA 228, or
section 243 of the Michigan business tax act, 2007 PA 36, MCL
208.1243.
(6) The state treasurer shall administer the tax prescribed by
this section in the manner provided in 1941 PA 122, MCL 205.1 to
205.31.
(7) The requirements of section 28 of 1941 PA 122, MCL 205.28,
that prohibit an employee or an authorized representative or former
employee or authorized representative or anyone connected with the
department of treasury from divulging any facts or information
obtained in connection with the administration of taxes, do not
apply to disclosure of the tax return prescribed in this act.