NASHVILLE, Tenn. (WTVF) — After months of an impasse, the Tennessee House and Senate have brokered a compromise in order to pass a business tax cut and refund.
Earlier this year, Governor Bill Lee announced that he wanted to make changes to the Franchise and Excise Tax, the state's business tax.
Lee's administration was afraid some businesses might sue the state, calling the tax unfair. So the Governor proposed — not only a tax cut — but a refund for businesses dating back three years.
Democrats have opposed the move from the very beginning.
"Do you know how many roads in your district $1.5 billion will create? Do you know how many teachers you could hire for $1.5 billion? Do you know how many people you could put on healthcare with 1.5 billion dollars? What are we doing here folks? We’re giving away $1.5 billion out of fear," said Rep. Bo Mitchell, D-Nashville.
"If we pass this bill, if you vote for this bill, I don’t want to hear the word fiscal conservative come out of your mouth because there is nothing fiscally conservative or fiscally responsible about a $1.7 billion handout," said Rep. John Ray Clemmons, D-Nashville.
For months, Republican leaders in the two chambers were stuck on the details. Originally, the House only wanted to give businesses refunds on the tax, dating back just a single year and also wanted some transparency on which businesses requested it. The Senate balked at that idea and wanted to do three years of refunds; no other provisions.
Ultimately, the two chambers through backroom negotiations and two public conference committees, here's the compromise they came up with. Businesses can request refunds up to three years of the F&E tax. A public list will be made available for thirty days online, detailing which businesses applied and received a refund, but it won't give exact dollar amounts.
Instead, there will be ranges: $0-$750, $751-$10,000, and $10,000+.
"Voting in favor of this is voting in favor of cutting almost 2 billion dollars out of taxes and putting it right back into small businesses," said Rep. William Lamberth, R-Portland and House Majority Leader. "I am eager to get their money back into their pockets -- so they can give raises to their employees, they can give bonuses to their employees, they can buy new pieces of equipment which I’m sure some of these businesses in your district and in mine, would certainly appreciate the ability to do."
Now that the F&E tax rebate has passed both chambers, it will go to the Governor's desk for his approval. He is expected to sign it.
Fostering Hope provides Christmas for kids in foster care. I'm delighted to see Fostering Hope expand this year to expand their reach to now include kids in Foster care in metro AND foster kids in East TN hard hit by Helene.
-Bree Smith
