What is the Missouri surplus lines tax rate based on?

The Missouri surplus lines tax rate is based on the gross premium amount before any deductions. This means that the tax is calculated on the total premium that the insurer receives for the policy, regardless of any fees or deductions that may apply. This approach ensures that the calculation of the tax reflects the total income generated from the policy, which is important for the proper assessment of the tax liability.

When considering the other options, one can see why they are not correct. For example, calculating the tax based on the total policy amount including federal taxes or net premium excluding applicable fees would not accurately reflect the income from the policy in terms of what is actually charged to the insured. The gross premium, which includes all fees but is not adjusted for deductions, provides a more comprehensive basis for tax assessment, ensuring that the tax system captures the full extent of revenue generated from surplus lines insurance in Missouri.