31A-3-303 - Payment of tax.
31A-3-303. Payment of tax.
(1) The insurer, all producers involved in the transaction, and the policyholder are jointlyand severally liable for the payment of the taxes required under Section 31A-3-301. Thepolicyholder's liability for payment of the premium tax under Section 31A-3-301 ends when thepolicyholder pays the tax to the producer or insurer. The insurer and all producers involved inthe transaction are jointly and severally liable for the payment of the additional tax requiredunder Section 31A-3-302. Except for the tax under Section 31A-3-302, the taxes under this partshall be paid by the policyholder who shall be billed specifically for the tax when billed for thepremium. Except for the tax imposed under Section 31A-3-302, absorption of the tax by theproducer or insurer is an unfair method of competition under Section 31A-23a-402.
(2) The commissioner shall by rule prescribe accounting and reporting forms andprocedures for insurers, producers, and policyholders to use in determining the amount of taxesowed under this part, and the manner and time of payment. If a tax is not paid within the timeprescribed under the commissioner's rule, a penalty shall be imposed of 25% of the tax due, plus1-1/2% per month from the time of default until full payment of the tax.
(3) Upon making a record of its actions, and upon reasonable cause shown, the State TaxCommission may waive, reduce, or compromise any of the penalties or interest imposed underthis part.
(4) If a policy covers risks that are only partially located in this state, for computation oftax under this part the premium shall be reasonably allocated among the states on the basis of risklocations. However, all premiums with respect to surplus lines insurance received in this state bya surplus lines producer or charged on policies written or negotiated in or from this state aretaxable in full under this part, subject to a credit for any tax actually paid in another state to theextent of a reasonable allocation on the basis of risk locations.
(5) All premium taxes collected under this part by a producer or by an insurer are theproperty of this state.
(6) If the property of any producer is seized under any process in a court in this state, orif his business is suspended by the action of creditors or put into the hands of an assignee,receiver, or trustee, all taxes and penalties due this state under this part are preferred claims andthe state is to that extent a preferred creditor.
Amended by Chapter 252, 2003 General Session
Amended by Chapter 298, 2003 General Session