Georgia has passed HB 552, which focuses on changes in the tax structure for captive insurance companies domiciled in the state.
The bill reduces the premium tax rate for captive insurance companies to 0.4 percent for the first $20 million, and a 0.3 percent tax rate thereafter.
The bill also lowers the aggregate maximum premium tax to $100,000 and clarifies that when two or more captive insurance companies are under common ownership, they can be taxed as a single company.
HB 552’s passage is expected to impact numerous businesses in Georgia, and bring additional captive insurance companies to the state.
“Passage of HB 552 will take Georgia from a historically unfriendly jurisdiction for licensing captive insurance companies to a competitive player in this arena,” said Alana Mueller, president of the Georgia Captive Insurance Organization.
“Roughly nine in 10 Fortune 1,000 companies have captives, which typically favour the state in which the company is headquartered, assuming the state has favourable captive laws in place.
She continued: “Whereas other states have offered competitive tax incentives for captives, until HB 552’s passage, Georgia has had a high premium tax rate on captives, and we are glad to see this rate reduced.”
