Opinion ID: 894999
Heading Depth: 2
Heading Rank: 3

Heading: The Retaliatory Tax Provision

Text: Nevertheless, the insurers contend that even if the full amount of the premium tax is not directly imposed on them, the Comptroller's interpretation must still fail because it conflicts with various portions of the retaliatory tax provision. The retaliatory tax provision operative at the time this dispute arose, Article 21.46 of the Insurance Code, allows the Comptroller to impose a retaliatory tax on an out-of-state insurer [w]henever by the laws of any other state or territory of the United States any taxes, ... licenses, fees, fines, penalties, deposit requirements or other obligations, prohibitions or restrictions are imposed upon any insurance company that is organized in this State and licensed and is doing business or that may do business in such other state or territory which, in the aggregate are in excess of the aggregate of the taxes, ... licenses, fees, fines, penalties, deposit requirements or other obligations, prohibitions or restrictions directly imposed upon a similar insurance company of such other state or territory doing business in this State.... [47] The insurers argue that the retaliatory tax provision does not just require insurance companies to compare the taxes imposed by Texas and their home states, the provision also requires them to compare other obligations ... directly imposed by this State. [48] According to the insurers, the Comptroller does not give them credit for all of the burdens they bear; namely, the Comptroller excludes from consideration the obligation to report [49] and remit [50] the full amount of the premium tax to the State. The last clause of Subsection (a) provides a clearer context for the meaning of other obligations: the aggregate of taxes, licenses, fees, fines, penalties or other obligations imposed by this State pursuant to this Article ... shall not exceed the aggregate of such charges imposed by such other state. [51] Here, the Legislature replaced the laundry list of taxes, fees, and other obligations with the words such charges, indicating that the other obligations meant to be included in the retaliatory tax calculations are financial charges directly imposed on title insurers. Thus, the administrative responsibilities of filling out forms and remitting the full premium tax do not qualify as other obligations under Article 21.46. [52]