Tennessee § 67-4-709 - Tax rates.

§ 67-4-709. Tax rates.

For the exercise of the privileges described, enumerated, or referred to in § 67-4-708 , every person shall pay the taxes imposed by §§ 67-4-704 and 67-4-705 according to the dominant business activity of the person as follows: CLASSIFICATION 1 as described in § 67-4-708(1): One tenth of one percent (1/10 of 1%) of all sales by a retailer classified under § 67-4-708(1)(A), (1)(B) or (1)(C); One fortieth of one percent (1/40 of 1%) of all sales by a wholesaler classified under § 67-4-708(1)(A); Three eightieths of one percent (3/80 of 1%) of all sales by a wholesaler classified under § 67-4-708(1)(B) or (1)(C); One twentieth of one percent (1/20 of 1%) of all sales by a retailer classified under § 67-4-708(1)(D); and One thirty-second of one percent (1/32 of 1%) of all sales by a wholesaler classified under § 67-4-708(1)(E); CLASSIFICATION 2 as described in § 67-4-708(2): Three twentieths of one percent (3/20 of 1%) of all sales by a retailer; and Three eightieths of one percent (3/80 of 1%) of all sales by a wholesaler; CLASSIFICATION 3 as described in § 67-4-708(3): Three sixteenths of one percent (3/16 of 1%) of all sales by a retailer; and Three eightieths of one percent (3/80 of 1%) of all sales by a wholesaler; CLASSIFICATION 4 as described in § 67-4-708(4): One tenth of one percent (1/10 of 1%) of the compensation entitled to under the contract, whether in the form of a contract price, commission, fee or wage, by the persons enumerated in § 67-4-708(4)(A); Persons who, during any taxable period, receive more than fifty thousand dollars ($50,000) of compensation from contracts in a county or incorporated municipality, or both, other than the county or incorporated municipality where domiciled or located, shall be deemed to have a location in the county or municipality, or both, where the work was performed and a business tax return shall be filed for that location for the period in question. Gross receipts reported on a deemed location return shall not be reported on the return of the business's permanent domicile; In computing the measure of the tax, except as provided by this part, no deduction will be allowed on account of the cost of tangible property sold, the cost of materials used, labor cost, reimbursed cost, interest, discount, delivery cost, taxes, or no other expense whatsoever paid or accrued and without any deduction on account of losses; and One tenth of one percent (1/10 of 1%) of the gross commissions, margins, fees or other charges by the persons enumerated in § 67-4-708(4)(B); and CLASSIFICATION 5 as described in § 67-4-708(5): Three tenths of one percent (3/10 of 1%) of the gross income of a business classified under § 67-4-708(5)(A); and “Gross income of the business” means all interest income, earned discounts, earned lease rentals, commission fees exclusive of insurance commissions, past due charges, contract earnings or charges, collection charges, loan service fees, late fee income and all other income, without any deduction except as provided by this part; One fiftieth of one percent (1/50 of 1%) of all sales within the state of a person classified under § 67-4-708(5)(B). Acts 1971, ch. 387, § 6; 1972, ch. 850, § 6; 1977, ch. 328, §§ 1, 2; 1978, ch. 714, § 4; 1978, ch. 781, § 1; 1979, ch. 325, § 1; 1981, ch. 308, § 1; 1983, ch. 394, § 3; 1983, ch. 415, § 1; T.C.A., § 67-5806; Acts 1984, ch. 832, § 27; 1986, ch. 699, §§ 2, 3; 1988, ch. 572, § 3; 1988, ch. 767, § 1; 1994, ch. 766, § 1; 1999, ch. 424, § 1; 2002, ch. 856, § 9a; 2003, ch. 418, § 3; 2004, ch. 924, § 9; 2009, ch. 530, § 75; 2013, ch. 313, §§ 8, 9; 2014, ch. 942, § 3. Compiler's Notes. Acts 1981, ch. 308, § 2 provided that the 1981 amendment should not take effect unless approved by a two-thirds vote of the county legislative body of any county to which it might apply. It was approved by the county legislative body of Blount County on June 1, 1981, and therefore is in effect in that county. Acts 2002 ch. 856 § 14(i) provided that the 2002 amendment by § 9 of that act shall apply to tax years ending on or after September 1, 2002. Acts 2002, ch. 856, § 13 provided that no expenditure of public funds pursuant to that act shall be made in violation of the provisions of Title VI of the Civil Rights Act of 1964, as codified in 42 U.S.C. § 2000 d. Acts 2004, ch. 924, § 19 provided that the amendment by §§ 8, 9, and 15 of that act shall apply to all tax periods for which returns were required to be filed on or after January 1, 2001. Acts 2013, ch. 313, § 1 provided that the act, which amended this section, shall be known and may be cited as the “Uniformity and Small Business Relief Act of 2013.” Acts 2013, ch. 313, § 23 provided that the act, which amended this section, shall apply to tax periods that begin on or after January 1, 2014. Acts 2014, ch. 942, § 8 provided that the act shall apply to tax periods that begin on or after July 1, 2014. Amendments. The 2013 amendment, effective January 1, 2014, rewrote the introductory paragraph which read: “For the exercise of the privileges described or enumerated in § 67-4-708 , persons shall pay a tax, according to the dominant business activity of the persons as follows:”; and added (1)(E). The 2014 amendment rewrote (5) which read: “(5) CLASSIFICATION 5 as described in § 67-4-708(5) :“(A) Three tenths of one percent (3/10 of 1%) of the gross income of the business; and“(B) “Gross income of the business” means all interest income, earned discounts, earned lease rentals, commission fees exclusive of insurance commissions, past due charges, contract earnings or charges, collection charges, loan service fees, late fee income and all other income, without any deduction except as provided by this part.” Effective Dates. Acts 2013, ch. 313, § 23. January 1, 2014. Acts 2014, ch. 942, § 8. July 1, 2014. Law Reviews. Building a House of Cards: A Policy Evaluation of Tennessee's Tax Reform Act of 2002 with Emphasis on Fairness to the Poor (Robert F. Parsley), 70 Tenn. L. Rev. 1177 (2003). Selected Tennessee Legislation of 1983 (N. L. Resener, J. A. Whitson, K. J. Miller), 50 Tenn. L. Rev. 785 (1983). Attorney General Opinions. In cities and counties that imposed the business tax at the maximum rate specified by the statute, the current business tax rates for those localities are the new maximum rates pursuant to Chapter 859 of the Public Acts of 2002; in jurisdictions that have imposed the business tax at a stated fraction of the maximum rates provided by the statute, the current rates for those jurisdictions are that same fraction of the new maximum rates, OAG 02-084 (8/2/02). Cited: Worrall v. Kroger Co., 545 S.W.2d 736, 1977 Tenn. LEXIS 606 (Tenn. 1977); Memphis Retail Liquor Dealers' Asso. v. Memphis, 547 S.W.2d 244, 1977 Tenn. LEXIS 555 (Tenn. 1977).