Illinois Gov. Rod Blagojevich has signed into law two bills dealing with taxation on surplus lines insurers and motor vehicle records fees.
S.B. 1634 will require surplus line producers to file reports twice a year with the director of insurance on all surplus line insurance transactions, and must pay a sum equal to 3.5 percent of the gross premiums. The new law also increases the foreign insurer tax offset from 1.25 percent to 1.75 percent for taxable years ending on or after December 31, 2003.
S.B. 1903, which establishes the 2004 fiscal budget for Illinois, also affects insurers in several areas. The new law increases the cost of the Secretary of State’s motor vehicle reports from $6 to $12. The tax bill also changes the state’s financial regulatory fees, increasing them by 50 percent, and increasing the Affiliated Group Maximum from $100,000 to $250,000. Insurance companies pay financial regulatory fees to cover the cost of Department of Insurance financial audits.
In addition, the new law adds a 1.5 percent surcharge on workers’ compensation premiums and a 0.045 percent payroll tax on self-insureds to fund the state’s Industrial Commission.
Finally, the new law will increase the surplus lines tax from 3 percent to 3.5 percent, and increases securities licensing and filing fees. Producer licensing fees will go up $30 for the individual two-year license for residents and $100 for non-residents.