7 LONG TITLE
8 General Description:
9 This bill modifies provisions related to the insurance premium tax.
10 Highlighted Provisions:
11 This bill:
12 ▸ modifies provisions earmarking revenue for certain firefighter reasons;
13 ▸ removes outdated reporting requirements;
14 ▸ clarifies deposit of money into the General Fund unless otherwise earmarked by
15 statute; and
16 ▸ makes technical changes.
17 Money Appropriated in this Bill:
18 This bill appropriates:
19 ▸ to the Firefighters' Retirement Trust Fund as a one-time appropriation
20 • from the General Fund, $17,100,000; and
21 ▸ to the Fire Academy Support Account as a one-time appropriation
22 • from the General Fund, $8,500,000.
23 Other Special Clauses:
24 This bill provides retrospective operation.
25 This bill provides a special effective date.
26 Utah Code Sections Affected:
28 49-11-901.5, as enacted by Laws of Utah 2011, Chapters 290 and 439
29 53-7-204.2, as last amended by Laws of Utah 2011, Chapter 303
30 59-1-403, as last amended by Laws of Utah 2015, Chapters 411 and 451
31 59-9-101, as last amended by Laws of Utah 2016, Chapter 135
33 Be it enacted by the Legislature of the state of Utah:
34 Section 1. Section 49-11-901.5 is amended to read:
35 49-11-901.5. Premium tax revenues -- Distribution.
36 (1) (a) In accordance with this section there shall be paid to the office:
37 (i) [
38 collected under Title 59, Chapter 9, Taxation of Admitted Insurers, [
42 (ii) 10% of all money assessed and collected under Title 59, Chapter 9, Taxation of
43 Admitted Insurers, upon premiums for life insurance, as defined in Section 31A-1-301, within
44 the state.
45 (b) Payments to the fund shall be made annually until the service liability under this
46 part is liquidated, after which the tax revenue provided in this Subsection (1) ceases.
47 (2) The office shall distribute the premium tax revenue paid under Subsection (1) as
49 (a) an amount determined by the office to fully fund the long-term disability program
50 provided for firefighters under Section 49-23-601;
51 (b) an amount determined by the office to the Firefighters' Retirement Trust Fund
52 created under Section 49-16-104 equal to the amount when calculated as a percentage of the
53 certified contribution rate for members in Divisions A and B, as defined under Section
54 49-16-301, that is the percentage of the certified contribution rate paid to the Firefighters'
55 Retirement Trust Fund on July 1, 2004; and
56 (c) any remaining amount in accordance with Section 49-11-902.
57 Section 2. Section 53-7-204.2 is amended to read:
58 53-7-204.2. Fire Academy -- Establishment -- Fire Academy Support Account --
60 (1) In this section[
61 Account created in Subsection (4).
64 (2) The board shall:
65 (a) establish a fire academy that:
66 (i) provides instruction and training for paid, volunteer, institutional, and industrial
68 (ii) develops new methods of firefighting and fire prevention;
69 (iii) provides training for fire and arson detection and investigation;
70 (iv) provides public education programs to promote fire safety;
71 (v) provides for certification of firefighters, pump operators, instructors, and officers;
73 (vi) provides facilities for teaching fire-fighting skills;
74 (b) establish a cost recovery fee in accordance with Section 63J-1-504 for training
75 commercially employed firefighters; and
76 (c) request funding for the academy.
77 (3) The board may:
78 (a) accept gifts, donations, and grants of property and services on behalf of the fire
79 academy; and
80 (b) enter into contractual agreements necessary to facilitate establishment of the school.
81 (4) (a) To provide a funding source for the academy and for the general operation of
82 the State Fire Marshal Division, there is created in the General Fund a restricted account
83 known as the Fire Academy Support Account.
84 (b) The following revenue shall be deposited in the account to implement this section:
85 (i) [
86 of the annual tax for each year that is levied, assessed, and collected under Title 59, Chapter 9,
87 Taxation of Admitted Insurers[
89 (ii) the percentage specified in Subsection [
90 upon life insurance premiums within the state;
91 (iii) the cost recovery fees established by the board;
92 (iv) gifts, donations, and grants of property on behalf of the fire academy;
93 (v) appropriations made by the Legislature; and
94 (vi) money collected from civil penalties in accordance with Section 53-7-504.
98 in the account each fiscal year is 5%.
99 Section 3. Section 59-1-403 is amended to read:
100 59-1-403. Confidentiality -- Exceptions -- Penalty -- Application to property tax.
101 (1) (a) Any of the following may not divulge or make known in any manner any
102 information gained by that person from any return filed with the commission:
103 (i) a tax commissioner;
104 (ii) an agent, clerk, or other officer or employee of the commission; or
105 (iii) a representative, agent, clerk, or other officer or employee of any county, city, or
107 (b) An official charged with the custody of a return filed with the commission is not
108 required to produce the return or evidence of anything contained in the return in any action or
109 proceeding in any court, except:
110 (i) in accordance with judicial order;
111 (ii) on behalf of the commission in any action or proceeding under:
112 (A) this title; or
113 (B) other law under which persons are required to file returns with the commission;
114 (iii) on behalf of the commission in any action or proceeding to which the commission
115 is a party; or
116 (iv) on behalf of any party to any action or proceeding under this title if the report or
117 facts shown by the return are directly involved in the action or proceeding.
118 (c) Notwithstanding Subsection (1)(b), a court may require the production of, and may
119 admit in evidence, any portion of a return or of the facts shown by the return, as are specifically
120 pertinent to the action or proceeding.
121 (2) This section does not prohibit:
122 (a) a person or that person's duly authorized representative from receiving a copy of
123 any return or report filed in connection with that person's own tax;
124 (b) the publication of statistics as long as the statistics are classified to prevent the
125 identification of particular reports or returns; and
126 (c) the inspection by the attorney general or other legal representative of the state of the
127 report or return of any taxpayer:
128 (i) who brings action to set aside or review a tax based on the report or return;
129 (ii) against whom an action or proceeding is contemplated or has been instituted under
130 this title; or
131 (iii) against whom the state has an unsatisfied money judgment.
132 (3) (a) Notwithstanding Subsection (1) and for purposes of administration, the
133 commission may by rule, made in accordance with Title 63G, Chapter 3, Utah Administrative
134 Rulemaking Act, provide for a reciprocal exchange of information with:
135 (i) the United States Internal Revenue Service; or
136 (ii) the revenue service of any other state.
137 (b) Notwithstanding Subsection (1) and for all taxes except individual income tax and
138 corporate franchise tax, the commission may by rule, made in accordance with Title 63G,
139 Chapter 3, Utah Administrative Rulemaking Act, share information gathered from returns and
140 other written statements with the federal government, any other state, any of the political
141 subdivisions of another state, or any political subdivision of this state, except as limited by
142 Sections 59-12-209 and 59-12-210, if the political subdivision, other state, or the federal
143 government grant substantially similar privileges to this state.
144 (c) Notwithstanding Subsection (1) and for all taxes except individual income tax and
145 corporate franchise tax, the commission may by rule, in accordance with Title 63G, Chapter 3,
146 Utah Administrative Rulemaking Act, provide for the issuance of information concerning the
147 identity and other information of taxpayers who have failed to file tax returns or to pay any tax
149 (d) Notwithstanding Subsection (1), the commission shall provide to the director of the
150 Division of Environmental Response and Remediation, as defined in Section 19-6-402, as
151 requested by the director of the Division of Environmental Response and Remediation, any
152 records, returns, or other information filed with the commission under Chapter 13, Motor and
153 Special Fuel Tax Act, or Section 19-6-410.5 regarding the environmental assurance program
154 participation fee.
155 (e) Notwithstanding Subsection (1), at the request of any person the commission shall
156 provide that person sales and purchase volume data reported to the commission on a report,
157 return, or other information filed with the commission under:
158 (i) Chapter 13, Part 2, Motor Fuel; or
159 (ii) Chapter 13, Part 4, Aviation Fuel.
160 (f) Notwithstanding Subsection (1), upon request from a tobacco product manufacturer,
161 as defined in Section 59-22-202, the commission shall report to the manufacturer:
162 (i) the quantity of cigarettes, as defined in Section 59-22-202, produced by the
163 manufacturer and reported to the commission for the previous calendar year under Section
164 59-14-407; and
165 (ii) the quantity of cigarettes, as defined in Section 59-22-202, produced by the
166 manufacturer for which a tax refund was granted during the previous calendar year under
167 Section 59-14-401 and reported to the commission under Subsection 59-14-401(1)(a)(v).
168 (g) Notwithstanding Subsection (1), the commission shall notify manufacturers,
169 distributors, wholesalers, and retail dealers of a tobacco product manufacturer that is prohibited
170 from selling cigarettes to consumers within the state under Subsection 59-14-210(2).
171 (h) Notwithstanding Subsection (1), the commission may:
172 (i) provide to the Division of Consumer Protection within the Department of
173 Commerce and the attorney general data:
174 (A) reported to the commission under Section 59-14-212; or
175 (B) related to a violation under Section 59-14-211; and
176 (ii) upon request, provide to any person data reported to the commission under
177 Subsections 59-14-212(1)(a) through (c) and Subsection 59-14-212(1)(g).
178 (i) Notwithstanding Subsection (1), the commission shall, at the request of a committee
179 of the Legislature, the Office of the Legislative Fiscal Analyst, or the Governor's Office of
180 Management and Budget, provide to the committee or office the total amount of revenues
181 collected by the commission under Chapter 24, Radioactive Waste Facility Tax Act, for the
182 time period specified by the committee or office.
183 (j) Notwithstanding Subsection (1), the commission shall make the directory required
184 by Section 59-14-603 available for public inspection.
185 (k) Notwithstanding Subsection (1), the commission may share information with
186 federal, state, or local agencies as provided in Subsection 59-14-606(3).
187 (l) (i) Notwithstanding Subsection (1), the commission shall provide the Office of
188 Recovery Services within the Department of Human Services any relevant information
189 obtained from a return filed under Chapter 10, Individual Income Tax Act, regarding a taxpayer
190 who has become obligated to the Office of Recovery Services.
191 (ii) The information described in Subsection (3)(l)(i) may be provided by the Office of
192 Recovery Services to any other state's child support collection agency involved in enforcing
193 that support obligation.
194 (m) (i) Notwithstanding Subsection (1), upon request from the state court
195 administrator, the commission shall provide to the state court administrator, the name, address,
196 telephone number, county of residence, and Social Security number on resident returns filed
197 under Chapter 10, Individual Income Tax Act.
198 (ii) The state court administrator may use the information described in Subsection
199 (3)(m)(i) only as a source list for the master jury list described in Section 78B-1-106.
205 (A) Office of the Legislative Fiscal Analyst; or
206 (B) Office of Legislative Research and General Counsel.
207 (ii) Notwithstanding Subsection (1) and except as provided in Subsection
210 (A) gained by the commission; and
211 (B) required to be attached to or included in returns filed with the commission.
212 (iii) (A) An office may not request and the commission may not provide to an office a
214 (I) address;
215 (II) name;
216 (III) Social Security number; or
217 (IV) taxpayer identification number.
218 (B) The commission shall in all instances protect the privacy of a person as required by
219 Subsection (3)[
220 (iv) An office may provide information received from the commission in accordance
221 with this Subsection (3)[
222 (A) as:
223 (I) a fiscal estimate;
224 (II) fiscal note information; or
225 (III) statistical information; and
226 (B) if the information is classified to prevent the identification of a particular return.
227 (v) (A) A person may not request information from an office under Title 63G, Chapter
228 2, Government Records Access and Management Act, or this section, if that office received the
229 information from the commission in accordance with this Subsection (3)[
230 (B) An office may not provide to a person that requests information in accordance with
231 Subsection (3)[
232 accordance with Subsection (3)[
234 governing board of the agreement or a taxing official of another state, the District of Columbia,
235 the United States, or a territory of the United States:
236 (i) the following relating to an agreement sales and use tax:
237 (A) information contained in a return filed with the commission;
238 (B) information contained in a report filed with the commission;
239 (C) a schedule related to Subsection (3)[
240 (D) a document filed with the commission; or
241 (ii) a report of an audit or investigation made with respect to an agreement sales and
242 use tax.
244 concerning a taxpayer's state income tax return or state income tax withholding information to
245 the Driver License Division if the Driver License Division:
246 (i) requests the information; and
247 (ii) provides the commission with a signed release form from the taxpayer allowing the
248 Driver License Division access to the information.
250 Communications Authority, or a division of the Utah Communications Authority, the
251 information requested by the authority under Sections 63H-7a-302, 63H-7a-402, and
254 Educational Savings Plan information related to a resident or nonresident individual's
255 contribution to a Utah Educational Savings Plan account as designated on the resident or
256 nonresident's individual income tax return as provided under Section 59-10-1313.
258 Sections 26-18-2.5 and 26-40-105, the commission shall provide an eligibility worker with the
259 Department of Health or its designee with the adjusted gross income of an individual if:
260 (i) an eligibility worker with the Department of Health or its designee requests the
261 information from the commission; and
262 (ii) the eligibility worker has complied with the identity verification and consent
263 provisions of Sections 26-18-2.5 and 26-40-105.
265 determined by the commission, information declared on an individual income tax return in
266 accordance with Section 59-10-103.1 that relates to eligibility to claim a residential exemption
267 authorized under Section 59-2-103.
268 (4) (a) Each report and return shall be preserved for at least three years.
269 (b) After the three-year period provided in Subsection (4)(a) the commission may
270 destroy a report or return.
271 (5) (a) Any person who violates this section is guilty of a class A misdemeanor.
272 (b) If the person described in Subsection (5)(a) is an officer or employee of the state,
273 the person shall be dismissed from office and be disqualified from holding public office in this
274 state for a period of five years thereafter.
275 (c) Notwithstanding Subsection (5)(a) or (b), an office that requests information in
276 accordance with Subsection (3)[
277 with Subsection (3)[
278 (i) is not guilty of a class A misdemeanor; and
279 (ii) is not subject to:
280 (A) dismissal from office in accordance with Subsection (5)(b); or
281 (B) disqualification from holding public office in accordance with Subsection (5)(b).
282 (6) Except as provided in Section 59-1-404, this part does not apply to the property tax.
283 Section 4. Section 59-9-101 is amended to read:
284 59-9-101. Tax basis -- Rates -- Exemptions -- Rate reductions.
285 (1) (a) Except as provided in Subsection (1)(b), (1)(d), or (5), an admitted insurer shall
286 pay to the commission on or before March 31 in each year, a tax of 2-1/4% of the total
287 premiums received by it during the preceding calendar year from insurance covering property
288 or risks located in this state.
289 (b) This Subsection (1) does not apply to:
290 (i) workers' compensation insurance, assessed under Subsection (2);
291 (ii) title insurance premiums taxed under Subsection (3);
292 (iii) annuity considerations;
293 (iv) insurance premiums paid by an institution within the state system of higher
294 education as specified in Section 53B-1-102; and
295 (v) ocean marine insurance.
296 (c) The taxable premium under this Subsection (1) shall be reduced by:
297 (i) the premiums returned or credited to policyholders on direct business subject to tax
298 in this state;
299 (ii) the premiums received for reinsurance of property or risks located in this state; and
300 (iii) the dividends, including premium reduction benefits maturing within the year:
301 (A) paid or credited to policyholders in this state; or
302 (B) applied in abatement or reduction of premiums due during the preceding calendar
304 (d) (i) For purposes of this Subsection (1)(d):
305 (A) "Utah variable life insurance premium" means an insurance premium paid:
306 (I) by:
307 (Aa) a corporation; or
308 (Bb) a trust established or funded by a corporation; and
309 (II) for variable life insurance covering risks located within the state.
310 (B) "Variable life insurance" means an insurance policy that provides for life
311 insurance, the amount or duration of which varies according to the investment experience of
312 one or more separate accounts that are established and maintained by the insurer pursuant to
313 Title 31A, Insurance Code.
314 (ii) Notwithstanding Subsection (1)(a), beginning on January 1, 2006, the tax on that
315 portion of the total premiums subject to a tax under Subsection (1)(a) that is a Utah variable
316 life insurance premium shall be calculated as follows:
317 (A) 2-1/4% of the first $100,000 of Utah variable life insurance premiums:
318 (I) paid for each variable life insurance policy; and
319 (II) received by the admitted insurer in the preceding calendar year; and
320 (B) 0.08% of the Utah variable life insurance premiums that exceed $100,000:
321 (I) paid for the policy described in Subsection (1)(d)(ii)(A); and
322 (II) received by the admitted insurer in the preceding calendar year.
323 (2) (a) An admitted insurer writing workers' compensation insurance in this state,
324 including the Workers' Compensation Fund created under Title 31A, Chapter 33, Workers'
325 Compensation Fund, shall pay to the tax commission, on or before March 31 in each year, a
326 premium assessment on the basis of the total workers' compensation premium income received
327 by the insurer from workers' compensation insurance in this state during the preceding calendar
328 year as follows:
329 (i) on or before December 31, 2010, an amount of equal to or greater than 1%, but
330 equal to or less than 5.75% of the total workers' compensation premium income described in
331 this Subsection (2);
332 (ii) on and after January 1, 2011, but on or before December 31, 2017, an amount of
333 equal to or greater than 1%, but equal to or less than 4.25% of the total workers' compensation
334 premium income described in this Subsection (2); and
335 (iii) on and after January 1, 2018, an amount equal to 1.25% of the total workers'
336 compensation premium income described in this Subsection (2).
337 (b) Total workers' compensation premium income means the net written premium as
338 calculated before any premium reduction for any insured employer's deductible, retention, or
339 reimbursement amounts and also those amounts equivalent to premiums as provided in Section
341 (c) The percentage of premium assessment applicable for a calendar year shall be
342 determined by the Labor Commission under Subsection (2)(d). The total premium income
343 shall be reduced in the same manner as provided in Subsections (1)(c)(i) and (1)(c)(ii), but not
344 as provided in Subsection (1)(c)(iii). The commission shall promptly remit from the premium
345 assessment collected under this Subsection (2):
346 (i) income to the state treasurer for credit to the Employers' Reinsurance Fund created
347 under Subsection 34A-2-702(1) as follows:
348 (A) on or before December 31, 2009, an amount of up to 5% of the total workers'
349 compensation premium income;
350 (B) on and after January 1, 2010, but on or before December 31, 2010, an amount of up
351 to 4.5% of the total workers' compensation premium income;
352 (C) on and after January 1, 2011, but on or before December 31, 2017, an amount of up
353 to 3% of the total workers' compensation premium income; and
354 (D) on and after January 1, 2018, 0% of the total workers' compensation premium
356 (ii) an amount equal to 0.25% of the total workers' compensation premium income to
357 the state treasurer for credit to the Workplace Safety Account created by Section 34A-2-701;
358 (iii) an amount of up to 0.5% and any remaining assessed percentage of the total
359 workers' compensation premium income to the state treasurer for credit to the Uninsured
360 Employers' Fund created under Section 34A-2-704; and
361 (iv) beginning on January 1, 2010, 0.5% of the total workers' compensation premium
362 income to the state treasurer for credit to the Industrial Accident Restricted Account created in
363 Section 34A-2-705.
364 (d) (i) The Labor Commission shall determine the amount of the premium assessment
365 for each year on or before each October 15 of the preceding year. The Labor Commission shall
366 make this determination following a public hearing. The determination shall be based upon the
367 recommendations of a qualified actuary.
368 (ii) The actuary shall recommend a premium assessment rate sufficient to provide
369 payments of benefits and expenses from the Employers' Reinsurance Fund and to project a
370 funded condition with assets greater than liabilities by no later than June 30, 2025.
371 (iii) The actuary shall recommend a premium assessment rate sufficient to provide
372 payments of benefits and expenses from the Uninsured Employers' Fund and to maintain it at a
373 funded condition with assets equal to or greater than liabilities.
374 (iv) At the end of each fiscal year the minimum approximate assets in the Employers'
375 Reinsurance Fund shall be $5,000,000 which amount shall be adjusted each year beginning in
376 1990 by multiplying by the ratio that the total workers' compensation premium income for the
377 preceding calendar year bears to the total workers' compensation premium income for the
378 calendar year 1988.
379 (v) The requirements of Subsection (2)(d)(iv) cease when the future annual
380 disbursements from the Employers' Reinsurance Fund are projected to be less than the
381 calculations of the corresponding future minimum required assets. The Labor Commission
382 shall, after a public hearing, determine if the future annual disbursements are less than the
383 corresponding future minimum required assets from projections provided by the actuary.
384 (vi) At the end of each fiscal year the minimum approximate assets in the Uninsured
385 Employers' Fund shall be $2,000,000, which amount shall be adjusted each year beginning in
386 1990 by multiplying by the ratio that the total workers' compensation premium income for the
387 preceding calendar year bears to the total workers' compensation premium income for the
388 calendar year 1988.
389 (e) A premium assessment that is to be transferred into the General Fund may be
390 collected on premiums received from Utah public agencies.
391 (3) An admitted insurer writing title insurance in this state shall pay to the commission,
392 on or before March 31 in each year, a tax of .45% of the total premium received by either the
393 insurer or by its agents during the preceding calendar year from title insurance concerning
394 property located in this state. In calculating this tax, "premium" includes the charges made to
395 an insured under or to an applicant for a policy or contract of title insurance for:
396 (a) the assumption by the title insurer of the risks assumed by the issuance of the policy
397 or contract of title insurance; and
398 (b) abstracting title, title searching, examining title, or determining the insurability of
399 title, and every other activity, exclusive of escrow, settlement, or closing charges, whether
400 denominated premium or otherwise, made by a title insurer, an agent of a title insurer, a title
401 insurance producer, or any of them.
402 (4) Beginning July 1, 1986, a former county mutual and a former mutual benefit
403 association shall pay the premium tax or assessment due under this chapter. Premiums
404 received after July 1, 1986, shall be considered in determining the tax or assessment.
405 (5) The following insurers are not subject to the premium tax on health care insurance
406 that would otherwise be applicable under Subsection (1):
407 (a) an insurer licensed under Title 31A, Chapter 5, Domestic Stock and Mutual
408 Insurance Corporations;
409 (b) an insurer licensed under Title 31A, Chapter 7, Nonprofit Health Service Insurance
411 (c) an insurer licensed under Title 31A, Chapter 8, Health Maintenance Organizations
412 and Limited Health Plans;
413 (d) an insurer licensed under Title 31A, Chapter 9, Insurance Fraternals;
414 (e) an insurer licensed under Title 31A, Chapter 11, Motor Clubs; and
418 (6) An insurer issuing multiple policies to an insured may not artificially allocate the
419 premiums among the policies for purposes of reducing the aggregate premium tax or
420 assessment applicable to the policies.
421 (7) The retaliatory provisions of Title 31A, Chapter 3, Department Funding, Fees, and
422 Taxes, apply to the tax or assessment imposed under this chapter.
423 (8) (a) Money collected under this chapter, unless otherwise allocated by statute to
424 another fund or account, shall be deposited into the General Fund.
425 (b) Money allocated to another fund or account includes the money allocated under:
426 (i) Section 49-11-901.5;
427 (ii) Section 53-7-204.2;
428 (iii) Section 59-9-105; and
429 (iv) Subsection (2).
430 Section 5. Appropriation.
431 The following sums of money are appropriated for the fiscal year beginning July 1,
432 2017, and ending June 30, 2018. These are additions to amounts previously appropriated for
433 fiscal year 2018. Under the terms and conditions of Title 63J, Chapter 1, Budgetary Procedures
434 Act, the Legislature appropriates the following sums of money from the funds or accounts
435 indicated for the use and support of the government of the state of Utah.
436 ITEM 1
437 To the Firefighters' Retirement Trust Fund
438 From General Fund, One-time
439 Schedule of Programs:
440 Firefighters' Retirement Trust Fund $17,100,000
441 ITEM 2
442 To the Fire Academy Support Account
443 From General Fund, One-time
444 Schedule of Programs:
445 GFR Fire Academy Support Account $8,500,000
446 Section 6. Retrospective operation.
447 This bill has retrospective operation for a taxable year beginning on or after January 1,
449 Section 7. Effective date.
450 If approved by two-thirds of all the members elected to each house, this bill takes effect
451 upon approval by the governor, or the day following the constitutional time limit of Utah
452 Constitution, Article VII, Section 8, without the governor's signature, or in the case of a veto,
453 the date of veto override.