Laws, Regulations and Annotations


Business Taxes Law Guide – Revision 2023

Tax on Insurers Law

Revenue and Taxation Code

Division 2. Other Taxes
Part 7. Insurance Taxation

Chapter 2. Ocean Marine Insurance

Article 2. Basis of Tax for Ocean Marine Insurance*

Section 12102

12102. In lieu of other taxes; exceptions. The tax is in lieu of all other state, county and municipal taxes and licenses upon the marine insurer, except taxes upon real estate, any retaliatory exactions imposed by paragraph (3) of subdivision (f) of Section 28 of Article XIII of the Constitution, motor vehicle and other vehicle registration license fees and any other tax or license fee imposed by the state upon vehicles, motor vehicles or the operation thereof, and taxes assessed or levied against the insurer on account of any other class of insurance written by it.

History—Stats. 1961, p. 1980, operative January 1, 1962, added the language beginning with "any retaliatory" and ending with "operation thereof." Stats. 1967, p. 2599, in effect November 8, 1967, deleted "the Legislature pursuant to" following "retaliatory exactions imposed by." Stats. 1974, p. 619, operative November 6, 1974, substituted "Section 28" for "Section 144/5".

In lieu tax.—Although in lieu of taxes on personal property, it is not, like the former public utility gross receipts tax, a direct tax on property, but is a franchise tax exacted for the privilege of doing business in the state. Thus, ownership by the insurance company, and not the use to which the property is being put, is the factor determining freedom of personal property from local taxation. Consolidated Title Security Co. v. Hopkins (1934) 1 Cal.2d 414.

A revenue ordinance imposing a tax on a person engaged in the business of soliciting, effecting and negotiating undertakings of bail as agent of an insurance company is invalid. Groves v. City of Los Angeles (1949) 93 Cal.App.2d 17; Groves v. City of Los Angeles (1953) 40 Cal.2d 751.

* Stats. 1961, p. 1980, operative January 1, 1962, amended the title of Article 2 by substituting "Basis of Tax" for "Tax Base".