News Notes on TN Taxes

An Offer of Amnesty
State Revenue Commissioner Reagan Farr says businesses that have been dodging taxes will be forgiven – if they register and pay three years of back taxes.
The state is taking over collection of the gross receipts business tax from county clerks under a bill passed by the Legislature last year. In doing so, the Revenue Department has found that as many as 100,000 businesses around the state had never registered to pay the tax. Chas Sisk has the followup story on the offer of amnesty.
Phone Taxes Unfair?
The Tennessee Advisory Commission on Intergovernmental Relations has produced a study that says the state has an unfair system of taxing telephone companies, reports WPLN.
Land-line companies are classified as utilities under state law, meaning they are subject to property tax on 50 percent of value. But cell phone companies and long-distance companies are classified otherwise and taxed on just 30 to 40 percent of value. A 2001 legislative attempt to address the inequality didn’t really work, says the TACIR study.
The study suggests the state either tax all telecommunications at the utility rate – an option companies are sure to fight – or consider them all to be regular businesses – meaning less property tax revenue for local governments.
Needless to say, legislators are not enthused about making such a move in an election year. WPLN quotes Rep. Mike Stewart, D-Nashville, as saying more study is needed.
TN Revenue Better Than Elsewhere
A short story in the Memphis Business Journal notes that the U.S. Census Bureau is also keeping track of state revenues. In the third quarter of 2009, the bureau says Tennessee’s total tax collections fell 5.7 percent. Nationally, state ad local governments were down an average of 6.7 percent for the same period.

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