The state comptroller’s office says a current tax arrangement on solar energy is unconstitutional, upping the pressure on legislators to cast the policy aside as a fight over its purpose escalates, reports the Nashville Business Journal.
A bill in the Tennessee General Assembly would change the tax treatment of solar companies, and various segments of the industry have spoken up, decrying it as a massive tax increase in place of an incentive they’d been anticipating.
Jason Mumpower, executive assistant to state Comptroller of the Treasury Justin Wilson, today cited a 1986 attorney general opinion, saying that a justification used for the treatment of solar installations is not constitutional.
He argued the current statute — passed in 2010 under the administration of Gov. Phil Bredesen, a Democrat — is open to challenge, and that therefore the comptroller is making tax law sound and preserving some incentive for solar companies.
“What we’re looking to do is correct a technical matter in the tax code,” Mumpower said. “What we’re doing is trying to help them.”
….Both McNally and Mumpower stopped short of accusing the Bredesen administration of passing a law to benefit a future business venture. But they said there could be the appearance of a conflict, with Farr pushing the law and then being part of the future company.
Farr called it “politics by a very political comptroller” for Republicans to be pushing the law change and making such suggestions. He said Silicon Ranch does not plan to apply for the tax benefit or other Bredesen initiatives. The company may consider future programs passed or reapproved by the legislature, based on circumstances at that time, he said.
Mumpower said the comptroller’s office is not seeking political gain against Farr or Democrats supportive of solar. Asked why the comptroller’s office doesn’t denounce suggestions about Farr, Mumpower said the comptroller’s motivation is only to fix the law, not engage in politics.