This is in response to your request for an official opinion regarding whether insurance companies exempt from federal income tax as religious and charitable organizations pursuant to Section 501(c) of the Internal Revenue Code are subject to state and local premium tax liability. It is my official opinion that insurance companies which are exempt from federal income tax pursuant to Section 501(c) of the Internal Revenue Code are subject to state and local premium tax liability unless exempted by a specific provision in the Georgia Insurance Code.

Official Code of Georgia Annotated §§ 33-8-4 and 33-8-8.2 provide the percentage of premiums levied or assessed against insurance companies. All insurance companies doing business in this state are required to pay the prescribed premium tax unless exempted. The Georgia Insurance Code also sets forth several exemptions from various taxes. O.C.G.A. § 33-36-16 (exempting the Georgia Insolvency Pool from all state and local taxes other than taxes on real or personal property of the pool); O.C.G.A. § 33-44-9 (exemption of high risk health insurance plan from all taxes levied by the state); O.C.G.A. § 33-15-83 (exemption for fraternal benefit society from state and local taxes other than taxes on real estate and office equipment); O.C.G.A. § 33-19-20 (exemption of nonprofit hospital services corporation from all taxes charitable and benevolent institutions are exempted from); O.C.G.A. § 33-18-28 (exemption of medical services corporation from all taxes charitable and benevolent institutions are exempted from). Each of these exemptions sets forth the type of organization to which the exemption applies and the specific taxes from which they are exempt.

There is no provision specifically exempting religious and charitable organizations from the state and local premium tax required by O.C.G.A. §§ 33-8-4 and 33-8-8.2 based solely on their character as a religious or charitable organization. Therefore, in order for a religious or charitable organization to be exempt from premium tax liability there must be a specific exemption which applies to the organization. For instance, if a religious organization is licensed as a fraternal benefit society, O.C.G.A. § 33-15-83 would exempt the organization from premium taxes. However, absent an express exemption, the religious or charitable organization is subject to state and local premium tax liability.

Therefore, it is my official opinion that companies which are exempt from federal income taxes pursuant to Section 501(c) of the Internal Revenue Code are subject to state and local premium tax liability unless the organization falls into one of the express exemptions set forth in the Georgia Insurance Code.

Prepared by:

JULIA GONZALEZ
Assistant Attorney General