Tennessee § 4-51-304 - Taxes — Collection — Disposition of taxes.

§ 4-51-304. Taxes — Collection — Disposition of taxes.

It is a taxable privilege to offer sports wagering in this state under a license issued in accordance with this part. Notwithstanding any state law to the contrary, a licensee shall only pay a privilege tax on its adjusted gross income in accordance with this section. There is imposed upon the adjusted gross income of a licensee a privilege tax of twenty percent (20%). The tax imposed under this section must be paid monthly by a licensee based on its monthly adjusted gross income for the immediately preceding calendar month. The tax must be paid to the corporation in accordance with rules promulgated by the corporation. For the purpose of enforcing this part and ascertaining the amount of tax due under this section, the corporation may competitively procure the services of a vendor to provide a central accounting and reporting system, to ascertain all bets wagered minus the total amount paid out to winning bettors daily, and such other information as the corporation may require. All licensees shall utilize such central accounting and reporting system. Eighty percent (80%) of the privilege tax collected under this section must be distributed by the corporation to the state treasurer for deposit into the lottery for education account created under § 4-51-111. Funds deposited under this subdivision (e)(1) must be accounted for separately by the corporation from funds collected by the corporation for the lottery. Section 4-51-111 is otherwise inapplicable to taxes collected and deposited under this subdivision (e)(1). Notwithstanding § 4-51-111, fifteen percent (15%) of the privilege tax collected under this section must be distributed by the corporation quarterly to the state treasurer for deposit into the general fund, to be remitted quarterly to each local government in this state on a per capita basis, as determined by population based on the last federal census. For purposes of calculating the allocation, the population of counties excludes the population of each municipality within the boundaries of the county. Funds remitted to a local government under this subdivision (e)(2) must be allocated to the county or city general fund, as applicable, to be used for local infrastructure projects, including, without limitation, transportation and road projects and public buildings. Notwithstanding § 4-51-111, five percent (5%) of the privilege tax collected under this section must be distributed by the corporation to the state treasurer and allocated to the department of mental health and substance abuse services to use in the manner prescribed by § 4-51-319. Acts 2019, ch. 507, § 1. Compiler's Notes. Acts 2019, ch. 507, § 7 provided that the act take effect July 1, 2019, the public welfare requiring it. The act was returned without the governor's signature and became effective under the provisions of Tenn. Const., art. III, § 18. Effective Dates. Acts 2019, ch. 507, July 1, 2019; provided that, for purposes of promulgating rules and carrying out any administrative duties necessary to effectuate the provisions and intent of this act, the act took effect on May 25, 2019. See Compiler’s Notes.