What entity is responsible for collecting surplus lines tax?

The correct answer identifies that the State Treasury Department is responsible for collecting surplus lines tax. In the context of surplus lines insurance, which includes coverage provided by non-admitted insurers, states impose a surplus lines tax as a means to regulate and generate revenue from this segment of the insurance market.

The State Treasury Department has the authority to manage and collect taxes, including those specific to surplus lines insurance. This role typically involves overseeing the compliance of insurance brokers who handle these unique insurance policies, ensuring that the tax is accurately assessed and collected based on the premiums written.

While other entities play significant roles within the insurance regulatory framework, such as ensuring compliance with insurance laws or overseeing general taxation, the specific function of collecting surplus lines tax is designated to the State Treasury Department. Understanding this jurisdictional responsibility is crucial for brokers operating within surplus lines to maintain compliance and avoid penalties.