2020 Legislative Summaries
Below are legislative summaries for the 2020 legislative session for legislation signed into law through July 2020.
Marketplace Facilitators
Public Chapter 646 requires marketplace facilitators that make or facilitate more than $500,000 in sales to Tennessee customers during the previous 12-month period to collect and remit Tennessee sales tax on sales made by third-party sellers to Tennessee customers.
Effective Date: October 1, 2020
Marketplace Facilitators and Sales Tax Holidays
Public Chapter 759 requires remote sellers and marketplace facilitators with more than $100,000 in sales to Tennessee customers during the previous 12-month period to collect and remit Tennessee sales tax on their sales.
This public chapter also modifies the sales tax holiday for 2020. The following goods may be purchased tax free during the weekend of July 31 through August 2, 2020:
- Clothing with a sales price of $200 or less
- School supplies with a sales price of $200 or less
- School art supplies with a sales price of $200 or less
- Electronic devices with a sales price of $3,000 or less
This public chapter also creates a new, additional sales tax holiday for 2020. The retail sale of food and drink by restaurants and limited service restaurants, as defined in Tenn. Code Ann. § 57-4-102, is exempt from sales tax during the weekend of August 7 through August 9, 2020.
Effective Date: June 30, 2020 for sales tax holiday provisions; October 1, 2020 for remote seller and marketplace facilitator provisions
Hotel Occupancy Tax
Public Chapter 787 requires short-term rental unit marketplaces to collect local occupancy taxes for short-term rental units secured through the marketplace and remit the tax to the Department of Revenue monthly. Short-term rental units are residential dwellings rented for less than 30 days, excluding hotels and bed and breakfasts.
This public chapter also requires that local governments report their occupancy tax rates to the Department annually and any time the rate is changed. The Department will make these rates publicly accessible.
Effective Date: January 1, 2021
Peer-to-Peer Car Sharing
Public Chapter 796 clarifies that the automobile rental surcharge tax is not imposed on entities or individual vehicle owners engaged in peer-to-peer car sharing. This public chapter also clarifies that peer-to-peer car sharing programs are marketplace facilitators for sales tax purposes and should begin collecting sales tax on behalf of their marketplace sellers beginning October 1, 2020.
Effective Date: July 15, 2020
Brownfield Tax Credit
Public Chapter 606 modifies the existing franchise and excise tax credit for the purchase of brownfield properties. The public chapter establishes a credit equal to 75% of the purchase price of a brownfield property purchased in a tier 3 and tier 4 enhancement county for the purpose of a qualified development project with a capital investment of at least $5 million.
The public chapter removes a number of components of the previous brownfield credit, including the requirement that at least five acres of the brownfield property be utilized, the $10 million per year cap on the total value of credits that may be awarded, and the 75% enhanced credit for a $200 million capital investment. The public chapter also excludes projects on non-prime agricultural property from eligibility for the credit.
Effective Date: July 1, 2020
Marketplace Facilitators
Public Chapter 646 requires marketplace facilitators that make or facilitate more than $500,000 in sales to Tennessee customers during the previous 12-month period to collect and remit Tennessee sales tax on sales made by third-party sellers to Tennessee customers.
Effective Date: October 1, 2020
Marketplace Facilitators and Sales Tax Holidays
Public Chapter 759 requires remote sellers and marketplace facilitators with more than $100,00 in sales to Tennessee customers during the previous 12-month period to collect and remit Tennessee sales tax on their sales.
This public chapter also modifies the sales tax holiday for 2020. The following goods may be purchased tax free during the weekend of July 31 through August 2, 2020:
- Clothing with a sales price of $200 or less
- School supplies with a sales price of $200 or less
- School art supplies with a sales price of $200 or less
- Electronic devices with a sales price of $3,000 or less
This public chapter also creates a new, additional sales tax holiday for 2020. The retail sale of food and drink by restaurants and limited service restaurants, as defined in Tenn. Code Ann. § 57-4-102, is exempt from sales tax during the weekend of August 7 through August 9, 2020.
Effective Date: June 30, 2020 for sales tax holiday provisions; October 1, 2020 for remote seller and marketplace facilitator provisions
Peer-to-Peer Car Sharing
Public Chapter 796 clarifies that the auto rental surcharge is not imposed on entities or individual vehicle owners engaged in peer-to-peer car sharing. This public chapter also clarifies that peer-to-peer car sharing programs are marketplace facilitators for sales tax purposes and should begin collecting sales tax on behalf of their marketplace sellers beginning October 1, 2020.
Effective Date: July 15, 2020
Commercial Development Districts
Public Chapter 809 expands eligibility for the commercial development district special allocation to those counties that border at least three distressed counties. These eligible counties must apply with the Department of Finance and Administration between January 1, 2021 and December 31, 2026. The Department must approve these districts by June 30, 2027.
Effective Date: July 15, 2020
New License Plates
Public Chapter 660 designates various new specialty license plates including:
- Alumni Program of the University of Tennessee, Knoxville
- University of Miami (Florida)
- I RECYCLE
- University of Texas
- West Virginia University
- ALS Awareness
- Make-A-Wish Foundation
- African American Breast Cancer Awareness
- Loyal Order of Moose
- Isaiah 117 House
- Habitat for Humanity
- Tennessee Chamber of Commerce and Industry
- Mothers Against Drunk Driving
- Greene County School System
- Service Dogs Changing Lives
- Childhood Cancer Awareness
- Enjoy the Ride
- 101st Airborne Screaming Eagle
- Big Brothers Big Sisters
- Women's Suffrage Centennial
This public chapter designates new military plates including:
- Disabled Veteran (service-connected)
This public chapter also designates new cultural plates including:
- Delta Kappa Gamma Society International
This public chapter expands eligibility for the Masons license plate to spouses of members of the Free and Accepted Masons.
This public chapter redefines “collegiate plate” to allow four-year law schools in Tennessee to create a collegiate license plate.
In addition, this public chapter extends until July 1, 2021, the timeframe for meeting the issuance requirement of 1,000 plates for the following license plates:
- Friends of Shelby Park and Bottoms
- Niswonger Children’s Hospital
Effective Date: July 1, 2020
Boat Dealer License Plates
Public Chapter 571 creates a new boat dealer license plate which the Department is authorized to issue to boat dealers and manufacturers who hire operators of boat trailers to transport boats to customers.
Effective Date: July 1, 2020
Emergency Personnel License Plates
Public Chapter 597 extends eligibility for the emergency personnel license plate to emergency medical technician-paramedics, other emergency medical services providers or emergency medical responders, and physicians or nurses on the scene or accompanying or attending a patient in an ambulance.
Effective Date: July 1, 2020
Salvage Certificates
Public Chapter 675 authorizes the Department of Revenue to issue, upon request, salvage certificates to insurance companies, salvage pool operators, and automotive dismantlers and recyclers that are unable to obtain a properly endorsed certificate of title or other acceptable proof of ownership for vehicles within 30 calendar days of the owner accepting a total loss settlement.
Effective Date: October 1, 2020
Specialty License Plate Extensions
Public Chapter 780 extends until July 1, 2021, the timeframe for meeting the issuance requirement of 1,000 plates for the following license plates:
- The Center for Living and Learning
- University of Tennessee Health Sciences Center
Effective Date: November 1, 2020
Lineman Power of Tennessee Specialty License Plates
Public Chapter 785 authorizes the Department of Revenue to issue the Lineman Power of Tennessee specialty license plates for motor vehicles owned by rural electric and community services cooperatives that are used for passenger transport and have a maximum weight of 9,000 lbs.
Effective Date: July 15, 2020