FISCAL NOTE
Date Requested: January 26, 2018
Time Requested: 09:27 AM |
| Agency: |
Insurance Commission |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1201 |
Introduced |
SB119 |
|
|---|
| CBD Subject: |
Taxation |
|---|
|
FUND(S):
7152, 1331
Sources of Revenue:
Special Fund
Legislation creates:
Decreases Existing Revenue
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
If enacted, SB119 may reduce premium tax revenue by $0 to $9 million per year beginning in fiscal year 2021. The maximum amount of potential tax credits to be taken under SB119 is estimated to be $36 million.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2018
Increase/Decrease
(use"-") |
2019
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
-36,000,000 |
Explanation of above estimates (including long-range effect):
SB119 establishes a cap of $60 million of qualified equity investments and allows for credit of up to 15% to be taken in the fourth year of the qualified low-income community investments.
It is unknown how many, if any, qualified equity investments will be made, or credits approved. If the maximum allowable investments under SB119 are made, then credits of $9 million per year maximum beginning in fiscal year 2021 and continuing through fiscal year 2024 or later could occur for total allowable credits of $36 million.
Memorandum
If enacted, SB119 may reduce premium tax revenue by $0 to $9 million per year beginning in fiscal year 2021. The maximum amount of potential tax credits to be taken under SB119 is estimated to be $36 million.
If enacted, Senate Bill 119 would establish an insurance premium tax credit for insurance companies for investment in qualified low-income communities. The WV Economic Development Authority would certify the entities to be approved to receive the insurance premium tax credits and provide notification to the Insurance Commissioner of the entities deemed eligible to use the tax credits. The Insurance Commissioner would be responsible for recapturing the tax credits for non-compliance.
SB119 establishes a cap of $60 million of qualified equity investments and allows for credit of up to 15% to be taken in the fourth year of the qualified low-income community investments.
It is unknown how many, if any, qualified equity investments will be made, or credits approved. If the maximum allowable investments under SB119 are made, then credits of $9 million per year maximum beginning in fiscal year 2021 and continuing through fiscal year 2024 or later could occur for total allowable credits of $36 million.
Person submitting Fiscal Note: Melinda Ashworth Kiss
Email Address: Melinda.A.Kiss@wv.gov