Tennessee Code 67-4-3003 – Privilege tax on sales in business activity in a qualified public use facility and in tourism development zones – Ordinance authorizing privilege tax – Petition by voters calling for election – Election – Duration of tax
Business: includes any activity engaged in by any person, or caused to be engaged in by the person, with the object of gain, benefit, or advantage, either direct or indirect. See Tennessee Code 67-4-3002
Municipality: means any incorporated city or county located in this state. See Tennessee Code 67-4-3002
Sales: means all gross receipts of the taxpayer not allocated under this part. See Tennessee Code 67-4-2004
Sales price: means the total amount for which tangible personal property or services rendered is sold, including any services that are a part of the sale, valued in money, whether paid in money or otherwise, and includes any amount for which credit is given to the purchaser by the seller, without any deduction from the price on account of the cost of the property sold, the cost of materials used, labor or service cost, losses, or any other expense whatsoever. See Tennessee Code 67-4-3002
(1) The making of sales by engaging in any business or business activity, except for those businesses exempt under § 67-4-712, in a qualified public use facility or in a portion of a qualified public use facility that is designated by an ordinance of the municipality is declared to be a privilege upon which the municipality in which the business or business activity is carried on may levy a privilege tax in an amount not to exceed five percent (5%) of the sales price.(2) The municipality may also by ordinance levy the privilege tax imposed by this part on businesses in the tourism development zone that are outside the qualified public use facility, that are owned or operated either wholly, partly, or jointly by the owner or operator of the qualified public use facility. Only the municipality that obtained certification of the tourism development zone in which the qualified public use facility is located is authorized to levy the tax pursuant to this part.(b)(1) No ordinance authorizing the privilege tax in subsection (a) shall take effect unless it is approved by a two-thirds (2/3) vote of the municipal legislative body at two (2) consecutive, regularly scheduled meetings, or unless it is approved by a majority of the number of qualified voters of the municipality voting in an election on the question of whether or not the tax should be levied.(2) If there is a petition of ten percent (10%) of the qualified voters who voted in the municipality in the last gubernatorial election that is filed with the county election commission within thirty (30) days of final approval of the ordinance by the municipal legislative body, then the county election commission shall call an election on the question of whether or not the tax should be levied in accordance with this section.(3) The municipal legislative body shall direct the county election commission to call the election, to be held in a regular election or in a special election for the purpose of approving or rejecting the tax levy. The municipality shall pay the cost of any special election.(4) The ballots used in the election shall have printed on them the substance of the ordinance and the voters shall vote for or against its approval.(5) The votes cast on the question shall be canvassed and the results proclaimed by the county election commission and certified by it to the municipal legislative body.(6) The qualifications of voters voting on the question shall be the same as those required for participation in general elections.(7) All laws applicable to general elections shall apply to the determination of the approval or rejection of this tax levy.(c)(1) Tax levied pursuant to this part shall continue until the earlier of:
(A)(i) If such qualified public use facility is described in § 67-4-3002(7)(A), the date on which the cumulative amount, apportioned and distributed to the municipality under §§ 7-88-106(a) and 67-4-3005, equals either the cost of the qualified public use facility, plus any interest on indebtedness of the municipality or public authority related to the cost, or any lesser amount of the cost of the qualified public use facility and interest that may be established in authorizing the levy of the tax; or(ii) If such qualified public use facility is described in § 67-4-3002(7)(B) or (7)(C), the date on which the cumulative amount, apportioned and distributed to the municipality under § 67-4-3005, equals either the cost of the qualified public use facility, plus any interest on indebtedness of the municipality or public authority related to the cost, or any lesser amount of the cost of the qualified public use facility and interest that may be established in authorizing the levy of the tax;(B) The date on which the qualified public use facility ceases to be a qualified public use facility; or(C) Thirty (30) years from the date it is reasonably anticipated that the facility will commence operations as a public use facility, at which time the authority of the municipality to levy the tax shall expire and be terminated.(2) Tax levied pursuant to this part for a qualified public use facility approved pursuant to § 7-88-106(a)(2) shall continue until the earlier of:
(A) Thirty (30) years from the date it is reasonably anticipated that the facility will commence operations as a public use facility; or(B) The date the cumulative amount apportioned and distributed to the municipality under § 67-4-3005 with respect to such public use facility equals the indebtedness of the municipality or public authority, plus interest thereon, related to the cost of the public use facility payable from such amount.
