Legislation will provide $400 million in tax relief to Tennesseans
NASHVILLE – Americans for Prosperity – Tennessee (AFP-TN) praised the State House of Representatives for passing HB 323, the Tennessee Works Tax Act. The legislation would provide $400 million in tax relief for Tennesseans and permanent tax cuts for thousands of small businesses. The companion bill, SB 275, will be heard in Senate Finance, Ways, and Means Committee tomorrow.
AFP-TN State Director Tori Venable released the following statement:
“We applaud Governor Lee and lawmakers for working together to provide relief by cutting taxes for Tennessee families and businesses. This is the largest permanent tax cut we’ve seen in a decade.
“This bill sends a clear message – If you are investing in our state, investing in Tennesseans, we’re going to reduce your tax burden and encourage growth by cutting taxes for businesses across our state.”
Background Details for HB 323 / SB 275
Transitioning to Single Sales Factor for franchise and excise taxes to improve TN’s ability to compete for jobs and investment.
Conforming with the federal bonus depreciation provisions of the 2017 Tax Cuts & Jobs Act, allowing businesses to recover costs more quickly and reinvest in the Tennessee economy.
Removing the business tax penalty on manufacturers for simply not having enough on-site storage.
Adopting additional model language from the Streamlined Sales Tax Agreement to make it easier for sellers to do business in Tennessee.
→ Pro-Small Business and Entrepreneurship
Offering small businesses excise tax relief by protecting the first $50,000 in net earnings.
Provides up to $3,250 in direct savings for Tennessee businesses. Applies pre-apportionment, targeting relief to businesses that have invested in Tennessee and providing an effective rate cut for many small- and medium-sized businesses across Tennessee.
Establishing a new Franchise Tax exemption of up to $500,000 in property from the minimum measure of the tax.
Up to $1,250 in annual tax savings for 68,000 small- and medium-sized businesses that pay franchise tax on their property in Tennessee.
Reducing Tennessee’s top business tax rate and raising the filing threshold for the Business Gross Receipts Tax.
Relieves 140,000 businesses from having to file annually by increasing current exemption levels from $10,000 to $100,000 in gross receipts per jurisdiction, with those under that threshold paying only a $15 local business license fee.
Reduces Tennessee’s top business tax rate from 0.3% to 0.1875% to increase Tennessee’s national competitiveness.