0001|                        SENATE BILL 375
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0002|     42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION,
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0003|     1996
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0004|                         INTRODUCED BY
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0005|                        MANNY M. ARAGON
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0006|     
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0007|                                
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0008|     
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0009|     
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0010|     
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0011|                             AN ACT
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0012|     RELATING TO INSURANCE; INCREASING THE PREMIUM TAX FOR HEALTH AND
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0013|     DENTAL BENEFITS COVERAGE.
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0014|     
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0015|     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0016|       Section 1.  Section 59A-6-2 NMSA 1978 (being Laws 1984,
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0017|     Chapter 127, Section 102, as amended) is amended to read:
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0018|       "59A-6-2.  PREMIUM TAX.--
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0019|            A.  The premium tax provided for in this section
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0020|     shall apply as to the following taxpayers:
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0021|                 (1)  each insurer authorized to transact
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0022|     insurance in New Mexico; 
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0023|                 (2)  each insurer formerly authorized to
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0024|     transact insurance in New Mexico and receiving premiums on
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0025|     policies remaining in force in New Mexico, except that this
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0001|     provision shall not apply as to an insurer that withdrew from
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0002|     New Mexico prior to March 26, 1955; 
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0003|                 (3)  each plan operating under provisions of
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0004|     Chapter 59A, Articles 46 through 49 NMSA 1978;
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0005|                 (4)  each property bondsman, as that person is
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0006|     defined in Section 59A-51-2 NMSA 1978, as to any consideration
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0007|     received as security or surety for a bail bond in connection
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0008|     with a judicial proceeding, which consideration shall be
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0009|     considered "gross premiums" for the purposes of this section;
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0010|     and
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0011|                 (5)  each unauthorized insurer that has assumed
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0012|     a contract or policy of insurance directly or indirectly from an
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0013|     authorized or formerly authorized insurer and is receiving
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0014|     premiums on such policies remaining in force in New Mexico,
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0015|     except that this provision shall not apply if a ceding insurer
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0016|     continues to pay the tax provided in this section as to such
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0017|     policy or contract.
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0018|            B.  Each such taxpayer shall pay in accordance with
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0019|     this subsection <s>[three percent]</s> <u>the specified percentage</u> of
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0020|     the gross premiums and membership and policy fees received by it
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0021|     on insurance or contracts covering risks within this state
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0022|     during the preceding calendar year, less all return premiums,
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0023|     including dividends paid or credited to policyholders or
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0024|     contract holders and premiums received for reinsurance on New
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0025|     Mexico risks. <u>The percentage to be paid is:</u>
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0001|                 <u>(1)  five percent in the case of health
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<u></u>0002| <u>    insurance or any health or dental benefits coverage issued by
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<u></u>0003| <u>    any plan operating under the provisions of Chapter 59A, Articles
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<u></u>0004| <u>    46 through 48 NMSA 1978; and</u>
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0005|                 <u>(2)  three percent in all other cases</u>.
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0006|       <u>    C.</u>  For each calendar quarter, an estimated payment
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0007|     shall be made on April 15, July 15, October 15 and the following
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0008|     January 15.  The estimated payments shall be equal to at least
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0009|     one-fourth of either the payment made during the previous
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0010|     calendar year or eighty percent of the actual payment due for
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0011|     the current calendar year, whichever is greater.  The final
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0012|     adjustment for payments due for the prior year shall be made
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0013|     with the return which shall be filed on April 15 of each year,
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0014|     at which time all taxes for that year are due.  Dividends paid
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0015|     or credited to policyholders or contract holders and refunds,
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0016|     savings, savings coupons and similar returns or credits applied
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0017|     or credited to payment of premiums for existing, new or
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0018|     additional insurance shall, in the amount so used, constitute
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0019|     premiums subject to tax under this section for the year in which
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0020|     so applied or credited. <s>[Provided that as to every insurer
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<s></s>0021| <s>    which throughout such preceding calendar year had at least forty
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<s></s>0022| <s>    percent of its admitted assets invested in New Mexico
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<s></s>0023| <s>    investments, as the same are defined in Subsection C of this
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<s></s>0024| <s>    section, the rate of such tax shall be nine-tenths of one
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<s></s>0025| <s>    percent in lieu of three percent; provided further that,
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<s></s>0001| <s>    effective January 1, 1992, the rate shall be one and four-tenths
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<s></s>0002| <s>    percent; effective July 1, 1992, the rate shall be one and nine-tenths percent; effective January 1, 1993, the rate shall be two
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<s></s>0003| <s>    and four-tenths percent; and effective July 1, 1993 and
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<s></s>0004| <s>    thereafter, the rate shall be three percent.
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<s></s>0005| <s>           C.  New Mexico investments for the purpose of
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<s></s>0006| <s>    Subsection B of this section are defined as follows:
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<s></s>0007| <s>                (1)  real estate located within New Mexico;
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<s></s>0008| <s>                (2)  bonds or obligations of New Mexico or of
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<s></s>0009| <s>    any county or other subdivision thereof;
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<s></s>0010| <s>                (3)  bonds, debentures or secured obligations of
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<s></s>0011| <s>    any corporation that has fifty percent of its assets located
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<s></s>0012| <s>    within New Mexico;
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<s></s>0013| <s>                (4)  first mortgages secured by real estate
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<s></s>0014| <s>    located within New Mexico;
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<s></s>0015| <s>                (5)  deposits in state banks, national banks and
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<s></s>0016| <s>    trust companies having their principal place of business within
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<s></s>0017| <s>    New Mexico;
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<s></s>0018| <s>                (6)  policy loans to residents of New Mexico;
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<s></s>0019| <s>    and
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<s></s>0020| <s>                (7)  preferred and common stock of corporations
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<s></s>0021| <s>    having at least fifty percent of their assets located within New
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<s></s>0022| <s>    Mexico.
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<s></s>0023| <s>           D.  Nothing contained in Subsection C of this section
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<s></s>0024| <s>    shall be construed to affect any provision of Chapter 59A,
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<s></s>0025| <s>    Article 9 NMSA 1978.
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<s></s>0001| <s>           E.]</s> <u>D.</u>  Exempted from the tax imposed by
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0002|     Subsection B of this section are premiums attributable to
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0003|     insurance or contracts purchased by the state or any political
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0004|     subdivision and payments received by a health maintenance
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0005|     organization from the federal secretary of health and human
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0006|     services pursuant to a contract issued under the provisions of
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0007|     42 U.S.C. Section 1395 mm(g)."
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0021|           
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0022|   
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0023|                    FORTY-SECOND LEGISLATURE
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0024|                      SECOND SESSION, 1996
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0025|   
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0001|   
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0002|                                              JANUARY 29, 1996
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0003|   
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0004|   Mr. President:
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0005|   
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0006|     Your COMMITTEES' COMMITTEE, to whom has been referred
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0007|   
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0008|                           SENATE BILL 375
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0009|   
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0010|   has had it under consideration and finds same to be GERMANE, PURSUANT
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0011|   TO CONSTITUIONAL PROVISIONS, and thence referred to the  WAYS AND
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0012|   MEANS COMMITTEE.
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0013|   
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0014|                              Respectfully submitted,
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0015|   
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0016|   
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0017|   
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0018|   
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0019|                              __________________________________
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0020|                              SENATOR MANNY M. ARAGON, Chairman 
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0021|   
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0022|   
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0023|   
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0024|   Adopted_______________________ Not Adopted_______________________
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0025|             (Chief Clerk)                        (Chief Clerk)
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0001|   
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0002|   
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0003|                     Date ________________________
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0004|   
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0005|   
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0006|   
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0007|   S0375CC1
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