An Act To Phase Out the Insurance Premium Tax on Annuities
Maine Legislature, Session 128, LD 0290
Committee Amendment CA_A_H282 (House)
Amends: 36 MRSA §2513-C, 36 MRSA §2515

COMMITTEE AMENDMENT «}4 "to H.P. 223, L.D. 290, Bill, "An Act To Phase 
Out the Insurance Premium Tax on Annuities" 
Amend the bill by striking out all of section 2 and inserting the following: 
'Sec. 2. 36 MRSA §2513-C is enacted to read: 
§2513-C. Tax on annuity considerations 
1. Phase-out of tax. Notwithstanding the other provisions of this chapter, the rate of 
tax under this chapter for annuity considerations is 1.5% in 2018, 1 % in 2019 and 0.5% in 
2020. Beginning in 2021, annuity considerations are not subject to tax under this chapter, 
but taxes due for previous years may be collected. 
2. 
Application of reduced rate on annuities. 
The reduced rates specified in 
subsection 1 for 2018, 2019 and 2020 apply to premiums on an annuity paid by annuity 
holders in this State only if the tax savings from the reduced rate are credited to the 
annuity holders. Upon request of the bureau, an insurer shall submit evidence that 
establishes that the tax savings derived from the reduced rate under this section have been 
credited to the annuity holders. 
Sec. 3. 36 MRSA §2515, as amended by PL 2013, c. 331, Pt. C, §11, is further 
amended to read: 
§2515. Amount of tax 
In determining the amount of tax due under sections 2513 and 2531, each company 
shall deduct from the full amount of gross direct premiums the amount of all direct return 
premiums on the gross direct premiums and all dividends paid to policyholders on direct 
premiums, and the tax must be computed by those companies or their agents. Except 
when direct return premiums are returned in the same tax year that the premium was paid, 
the deduction allowed in this section may be taken only if the tax under this Part has been 
paid. 
The deductions under this section related to annuity considerations may be 
deducted only from annuity considerations. 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" A" to H.P. 223, L.D. 290 
Sec. 4. Application. That section of this Act that amends the Maine Revised 
Statutes, Title 36, section 2515 applies to tax periods beginning on or after January 1, 
2018. 
Sec. 5. Appropriations and allocations. 
The following appropriations and 
allocations are made. 
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF 
Revenue Services, Bureau of 0002 
Initiative: Provides one-time funding to adjust the premium tax return to reflect updated 
rates for annuity premiums. 
GENERAL FUND 
All Other 
GENERAL FUND TOTAL 
2017-18 
$33,000 
$33,000 
2018-19 
$0 
$0 
SUMMARY 
This amendment provides that premiums on annuities are subject to premium tax 
during the phase-out period proposed in the bill at the prescribed rate only if the insurer 
credits the savings from the rate reduction to annuity holders. The amendment clarifies 
that certain deductions related to annuities may be deducted only from annuity 
considerations for tax periods beginning on or after January 1, 2018. 
This amendment also provides one-time funding to the Department of Administrative 
and Financial Services to adjust the premium tax return. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Net Cost (Savings) 
General Fund 
Approved: 05/15/17 feac.. 
LD290 
LR 901(02) 
An Act To Phase Out the Insurance Premium Tax on Annuities 
Fiscal Note for Bill as Amended by Committee Amendment ,A ( IJ .. ~ ~J.) 
Committee: Taxation 
Fiscal Note Required: Yes 
Fiscal Note 
... FY.2017-18 
FY 2018-19 
Projections 
FY 2019-20 
Projections 
FY 2020-21 
$1,031,000 
$2,528,000 
$4,103,000 
$5,678,000 
Appropriations/ Allocations 
General Fund 
$33,000 
$0 
$0 
$0 
Revenue 
General Fund 
($9?8,000) 
($2,5z.8,000) 
($4, 103,000) 
($5,678,000) 
Fiscal Detail and Notes 
Phasing out the insurance premium tax over 4 years would result in a loss of General Fund revenue of $998,000 in 
fiscal year 2017-18 and $2,528,000 in fiscal year 2018-19. The bill includes a one-time General Fund appropriation 
to the Department of Administrative and Financial Services of $33 ,000 in fiscal year 2017-18 to adjust the premium 
tax return to reflect updated rates for annuity premiums. 
LR0901(02) - Fiscal Note - Page 1 of 1