2006 Ohio Revised Code - 5725.18. Annual franchise tax on the privilege of being an insurance company.

§ 5725.18. Annual franchise tax on the privilege of being an insurance company.
 

(A)  An annual franchise tax on the privilege of being an insurance company is hereby levied on each domestic insurance company. In the month of May, annually, the treasurer of state shall charge for collection from each domestic insurance company a franchise tax in the amount computed in accordance with the following, as applicable: 

(1) With respect to a domestic insurance company that is a health insuring corporation, one per cent of all premium rate payments received, exclusive of payments received under the medicare program established under Title XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 301, as amended, or pursuant to the medical assistance program established under Chapter 5111. of the Revised Code, as reflected in its annual report for the preceding calendar year; 

(2) With respect to a domestic insurance company that is not a health insuring corporation, one and four-tenths per cent of the gross amount of premiums received from policies covering risks within this state, exclusive of premiums received under the medicare program established under Title XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 301, as amended, or pursuant to the medical assistance program established under Chapter 5111. of the Revised Code, as reflected in its annual statement for the preceding calendar year, and, if the company operates a health insuring corporation as a line of business, one per cent of all premium rate payments received from that line of business, exclusive of payments received under the medicare program established under Title XVIII of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 301, as amended, or pursuant to the medical assistance program established under Chapter 5111. of the Revised Code, as reflected in its annual statement for the preceding calendar year. 

(B)  The gross amount of premium rate payments or premiums used to compute the applicable tax in accordance with division (A) of this section is subject to the deductions prescribed by section 5729.03 of the Revised Code for foreign insurance companies. The objects of such tax are those declared in section 5725.24 of the Revised Code, to which only such tax shall be applied. 

(C)  In no case shall such tax be less than two hundred fifty dollars. 
 

HISTORY: GC § 5414-9; 114 v 714 (753); 115 v 576; Bureau of Code Revision, 10-1-53; 139 v H 694 (Eff 11-15-81); 141 v H 201 (Eff 7-1-85); 147 v H 215 (Eff 6-30-97); 147 v H 698. Eff 3-22-99.
 

The provisions of §§ 7, 8 of HB 698 (147 v  - ) read as follows: 

SECTION 7. That Section 194 of Am. Sub. H.B. 215 of the 122nd General Assembly be amended to read as follows: 

"Sec. 194. Insurance Tax Phase-in Schedules 

Sections 1731.07, 5725.18, 5725.181, 5729.03, and 5729.031 of the Revised Code, as amended or enacted by Am. Sub. H.B. 215 or Sub. H.B. 698 of the 122nd General Assembly, shall first apply to tax year 1999 and shall be implemented according to the following schedule: 

(A) For tax years 1999 through 2002, the tax imposed under section 5729.03 of the Revised Code on foreign insurance companies that are not health insuring corporations shall equal the sum of the amounts computed under divisions (A)(1) and (2) of this section. 

(1) With respect to the gross premiums of the company, exclusive of premiums received under Medicare or Medicaid, the amount computed using the following rates: 
  
      For Tax Year                The percentage of
                                 
premiums is
    1999                                  2.3%
    2000                                  2.09%
    2001                                  1.84%
    2002                                  1.62%
 

(2) With respect to premium rate payments received by the company, exclusive of payments received under Medicare or Medicaid, if the company operates a health insuring corporation as a line of business, the amount computed using the following rates: 
  
      For Tax Year                The percentage of
                                 
premiums
rate payments is
                                 
    1999                                  .21%
    2000                                  .42%
    2001                                  .60%
    2002                                  .80%
 

(B) For tax years 1999 through 2002, the tax imposed under section 5725.18 of the Revised Code on domestic insurance companies that are not health insuring corporations shall equal the sum of the amounts computed under divisions (B)(1) and (2) of this section. 

(1) The tax computed according to the method prescribed in section 5725.181 of the Revised Code, as enacted by Am. Sub. H.B. 215 of the 122nd General Assembly, multiplied by the percentage prescribed as follows: 
  
      For Tax Year                Multiply the tax under
                                 
section 5725.181 of
the
                                  Revised Code by
    1999                                   79%
    2000                                   58%
    2001                                   40%
    2002                                   20%
 

(2) The tax computed according to the method prescribed in section 5725.18 of the Revised Code, as amended by Sub. H.B. 698 of the 122nd General Assembly, multiplied by the percentage prescribed as follows: 
  
      For Tax Year                Multiply the tax
under
                                  amended section
5725.181
                                  of the
Revised Code by
    1999                                   21%
    2000                                   42%
    2001                                   60%
    2002                                   80%
 

(C) For tax years 1999 through 2002, the tax imposed under sections 5725.18 and 5729.03 of the Revised Code on domestic and foreign insurance companies that are health insuring corporations shall be computed using the following rates: 
  
      For Tax Year                The percentage of premium
                                 
rate payments is
    1999                                  .21%
    2000                                  .42%
    2001                                  .60%
    2002                                  .80%
 

(D) For tax years 1999 through 2002, the minimum tax for domestic insurance companies taxed under sections 5725.18 and 5725.181 of the Revised Code, the minimum tax for foreign insurance companies taxed under section 5729.03 of the Revised Code, and the minimum tax for companies that are health insuring corporations taxed under those sections shall equal the amount prescribed as follows: 
  
      For Tax Year                   The minimum tax is
    1999                                   $50
    2000                                  $100
    2001                                  $150
    2002                                  $200
 

(E) For tax years 1999 through 2002, the credit available under section 5729.031 of the Revised Code may be claimed against the tax imposed on foreign insurance companies as computed under division (A) of this section, against the tax imposed on domestic insurance companies as computed under division (B) of this section, or against the tax imposed on companies that are health insuring corporations as computed under division (C) of this section. The credit shall equal a percentage of the amount computed under division (C) of section 5729.031 of the Revised Code according to the following schedule: 
  
      For Tax Year                Percentage of
credit
                                  allowed is
    1999                                   20%
    2000                                   40%
    2001                                   60%
    2002                                   80%
 

As used in this section, "health insuring corporation" has the same meaning as in section 1751.01 of the Revised Code, and "tax year" means the calendar year in which the tax imposed on the insurance company or health insuring corporation is charged." 

SECTION 8. That existing Section 194 of Am. Sub. H.B. 215 of the 122nd General Assembly is hereby repealed.