Section 7902 - Rate of tax; distribution and use of tax proceeds(a) Imposition of tax.--Every insurance company, as herein defined, transacting business in the Commonwealth of Pennsylvania, shall pay to the department, a tax at the rate of two per cent of the gross premiums received from business done within this Commonwealth during each calendar year.(b) Disposition of taxes.-- The total of the money received from the following taxes and charges shall be deposited into the General Fund:
(1) The tax imposed by subsection (a).(2) The retaliatory charge imposed by section 212 of the act of May 17, 1921 ( P.L. 789, No.285), known as "The Insurance Department Act of 1921."(3) The surplus lines tax imposed by section 1621 of the act of May 17, 1921 ( P.L. 682, No.284), known as "The Insurance Company Law of 1921."(4) The tax on independently procured insurance imposed by section 1622 of "The Insurance Company Law of 1921."(5) The marine insurance tax imposed by section 2 of the act of May 13, 1927 ( P.L. 998, No.486), entitled "an act imposing a tax for State purposes on marine insurance underwriting profits, and providing for the collection of such tax."(6) The tax on contracts with unauthorized companies imposed by section 1 of the act of July 6, 1917 ( P.L. 723, No.262), entitled "an act imposing a tax on premiums of insurance and reinsurance in foreign insurance companies and associations not registered in this Commonwealth; providing the method of collection of such tax, and imposing penalties."(b.1) The following transfers will occur each fiscal year:(1) Fire Insurance Tax Fund: (i) On or before June 30, 2023, and on or before each June 30 thereafter, the greater of eighty-five million dollars ($85,000,000) or eight and one-half per cent of the total taxes and charges under subsection (b) received during the current fiscal year shall be transferred to the Fire Insurance Tax Fund.(ii) On or before July 15, 2023, and on or before each July 15 thereafter, if taxes or charges are deposited after the transfer under subparagraph (i) and before July 1, 2023, and each July 1 thereafter, an additional transfer shall occur if eight and one-half per cent of total collections under subsection (b) for the prior fiscal year is greater than eighty-five million dollars ($85,000,000). The calculation for the additional transfer shall equal eight and one-half per cent of the total taxes and charges under subsection (b) minus the transfer amount under subparagraph (i).(iii) The transfers under subparagraphs (i) and (ii) shall be used for firemen's relief pension or retirement purposes, as provided by section 706(B) of the act of December 18, 1984 ( P.L. 1005, No.205), known as the "Municipal Pension Plan Funding Standard and Recovery Act."(2) Municipal Pension Aid Fund: (i) On or before June 30, 2023, and on or before each June 30 thereafter, the greater of three hundred forty-five million dollars ($345,000,000) or thirty-eight per cent of the total taxes and charges under subsection (b) received during the current fiscal year shall be transferred to the Municipal Pension Aid Fund.(ii) On or before July 15, 2023, and on or before each July 15 thereafter, if taxes or charges are deposited after the transfer under subparagraph (i) and before July 1, 2023, and each July 1 thereafter, an additional transfer shall occur if thirty-eight per cent of total collections under subsection (b) for the prior fiscal year is greater than three hundred forty-five million dollars ($345,000,000). The calculation for that additional transfer shall equal thirty-eight per cent of the total taxes and charges under subsection (b) minus the transfer amount under subparagraph (i).(iii) The transfers under subparagraphs (i) and (ii) shall be used for police pension, retirement or disability purposes as provided by the act of May 12, 1943 ( P.L. 259, No.120), entitled "an act providing for the payment by the State Treasurer, of the amount of the tax on premiums paid by foreign casualty insurance companies, to the treasurers of the several cities, boroughs, towns, townships, and certain counties, and for the payment thereof into police pension funds, and in certain cases into the Municipal Employes' Retirement System, and for pension annuity contracts, and in certain other cases into the State Employes' Retirement Fund, for certain purposes."Amended by P.L. TBD 2022 No. 53, § 7, eff. 7/8/2022.Amended by P.L. 751 2012 No. 85, § 8, eff. 7/2/2012.1971, March 4, P.L. 6, No. 2, art. IX, § 902. Amended 1991, Aug. 4, P.L. 97, No. 22, § 27, imd. effective; 1995, June 30, P.L. 139, No. 21, § 11, effective July 1, 1995.