
The nasty hidden state tax that Californians all pay — a tax charged in only 7 states
Here’s a nasty tax that Californians pay every year. It’s a tax that you are probablycompletelyunaware of — a tax that is charged in only 6 other states. When you pay for your California homeowners policy, life insurance, car insurance, health insurance, business insurance, annuity — ANY insurance product except “tax qualified” plans (annuity retirement plans, primarily) — hidden inside your insurance bill is a 2.35% CA premium tax — essentially a sales tax. It’s not broken out as a tax in your bill, nor discussed by your insurance companies when you buy their products.
It’s a tax in lieu of the insurance companies paying a corporate income tax on NET profits — the way the vast majority of states choose to tax insurance corporations (if they have a state corporate income tax at all, of course).
I don’t know for sure exactly how we compare with other states overall on this tax, but I DID find the figures on how we rank with our 2.35%… Read More