NU Online News Service, Feb. 14, 3:28 p.m.EST
|The Obama administration today reinstated its call for a new taxon offshore insurers, but under a formula greater than thatproposed by the administration in past years.
|The latest proposal conforms to legislation supported bydomestic insurers such as W.R. Berkley and Chubb.
|Opponents say the proposal, if enacted, “would drastically raiseinsurance rates across the country.”
|Under the proposal, aU.S.insurance company would be denied adeduction for certain non-taxed reinsurance premiums paid tooffshore affiliates.
|Offshore insurers withU.S.affiliates would be allowedto offset taxes paid on revenues ceded to offshore affiliatesby deducting return premiums, ceded commissions, recoveredreinsurance or other amounts received from overseas affiliates.
|According to the Coalition for Competitive Insurance Rates, theproposal closely resembles legislation, H.R. 3157 and S. 1693)introduced by Rep. Richard Neal, D-Mass., and Sen. Robert Menendez,D-N.J.
|The CCIR cited in a statement opposing the legislation a studyby the Peterson Institute for International Economics.
|The policy brief, “Another Shot at Protection by Stealth: Usingthe Tax Law to Penalize Foreign Insurance Companies,” says that“U.S. consumers who live in disaster-prone areas would suffer atthe hand of Congress.”
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