Business Tax

The Business Tax Act makes it a taxable privilege to make sales or engage in any vocation listed in Tenn. Code Ann. Sections 67-4-708(1) – (4). Any county or incorporated municipality on Tennessee may levy the privilege tax on those listed activities that take place within its geographical boundaries. (Tenn. Code Ann. Section 67-4-704) Engaging in any business, business activity, vocation, or occupation described under this act is declared to be a privilege for state purposes and taxable by the state alone. (Tenn. Code Ann. Section 67-4-705) The tax imposed under the Business Tax Act may be collected in addition to any other applicable privilege taxes established by law. The tax will be in lieu of any or all ad valorem taxes on the inventories of merchandise held for sale or exchange by persons taxable under this law. (Tenn. Code Ann. Section 67-4-701)

“Business” Defined
“Business” includes any activity engaged in by any person with the object of gain, benefit, or advantage, either directly or indirectly. Business does not include occasional and isolated sales or transactions by a person who is not routinely engaged in business. Occasional and isolated sales, also known as casual and isolated sales, are sales made by persons not in the business of regularly selling the type of property being sold. Occasional and isolated sales are also sales of tangible property taking place only during temporary sales periods of 30 days or less and occurring no more than twice per year such as the sale of Girl Scout cookies. Business also does not include an individual property owner that utilizes a property management company to manage vacation lodging for overnight rentals.



Tennessee Department of Revenue
Taxpayer Services Division
Andrew Jackson Building, 3rd Floor
500 Deaderick Street
Nashville, Tennessee 37242-1099
Toll Free: (800) 342-1003
Out-of-state: (615) 253-0600
TDD: (615) 741-7398

Regional Offices

540 McCallie Avenue
Suite 350
Chattanooga, TN 37402
(423) 634-6266

Lowell Thomas State Office Building
225 Dr. Martin L. King Jr. Drive
Room 405-B
Jackson, TN 38301

Johnson City:
204 High Point Drive
Johnson City, TN 37601
(423) 854-5321
531 Henley Street
Room 606
Knoxville, TN 37902
(865) 594-6100
3150 Appling Road
Bartlett, TN 38133
(901) 213-1400
511 West Second North Street
Morristown, TN 37814
(423) 586-1993

Hotel and Motel Tax

The 5% Occupancy Program was approved by the Metropolitan Council on May 25, 1976 (Bill No. 76-143). As amended, this ordinance levees a 5% tax upon the privilege of occupancy, provides the procedure for collection, enforcement, distribution and administration of the proceeds thereof and establishing a Tourism and Convention Commission . Chapter 704 of the Public Acts of 1976, as passed by the 89th General Assembly of the State of Tennessee, authorized counties having a Metropolitan form of government to levy a privilege tax upon the occupancy in any hotel, motel or bed and breakfast of each transient in an amount not to exceed five percent (5%) of the consideration charged by the operator.