Vermont eases tax rules on dormant captives

Vermont Gov. Peter Shumlin has signed legislation clarifying that certain types of captives, such as sponsored and industrial insured captives that are not writing any business be allowed to enter a dormant status, exempting the captives from Vermont’s minimum annual premium tax.

The measure signed Wednesday, H. 538, also allows for cells to be converted from a protected cell to an incorporated cell, allows cells to be transferred or sold, and allows cells to be converted to stand-alone captives of any type.

At year-end 2015, Vermont was the world’s third largest captive domicile — trailing only Bermuda and the Cayman Islands — and the largest in the United States with 596 captives.