HB 187-FN-A - AS INTRODUCED
2003 SESSION
09/10
HOUSE BILL 187-FN-A
AN ACT establishing a credit for employer-paid insurance premiums against the business enterprise tax.
SPONSORS: Rep. Corbin, Rock 79; Rep. DiFruscia, Rock 76; Rep. Giuda, Graf 13; Rep. Gilman, Graf 9; Rep. Weyler, Rock 79
This bill establishes a credit against the business enterprise tax for insurance premiums paid by employers for employees residing in this state.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03-0025
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Three
AN ACT establishing a credit for employer-paid insurance premiums against the business enterprise tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Section; Business Enterprise Tax; Credit for Insurance Premiums Paid by Employers for Employees. Amend RSA 77-E by inserting after section 3 the following new section:
77-E:3-a Credit for Insurance Premiums. A taxpayer under this chapter shall be allowed a credit against the tax due under this chapter for the total amount of insurance premiums paid by the taxpayer for employees residing within this state.
2 Effective Date. This act shall take effect July 1, 2003.
LBAO
03-0025
12/30/02
HB 187-FN-A - FISCAL NOTE
AN ACT establishing a credit for employer-paid insurance premiums against the business enterprise tax.
FISCAL IMPACT:
The Department of Revenue Administration indicates that this bill will decrease state unrestricted general fund revenues by $68.8 million in FY 2003, $140.4 million in FY 2004 and $144.7 million in FY 2005. There is no fiscal impact on state, county and local expenditures or county and local revenues.
METHODOLOGY:
The Department states this bill will decrease state unrestricted general fund revenues from the Business Enterprise Tax (BET) by $68.8 million in FY 2003, $140.4 million in FY 2004 and $144.7 million in FY 2005. The Department did not project beyond FY 2005. The Department used the following assumptions to determine these estimates:
· BET is assumed to produce $162 million of revenue in FY 2003, with a 2% and 3% growth rate for FY 2004 and FY 2005 respectively.
· With the broad nature of the term "insurance premiums", and a BET rate of .75%, the Department assumes that 85% of all New Hampshire employers subject to the BET will pay insurance premiums in excess of BET, and therefor, will no longer be subject to the BET tax.
· The Department states that although this bill has an effective date of FY 2004, revenue will decrease in FY 2003 to reflect tax estimates due in April and June 2003 for calendar year 2003 that would no longer be required.
· The Department can administer this tax change at no additional cost.