Tennessee General Assembly Approves Legislation Eliminating Professional Privilege Tax

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The Tennessee General Assembly this week passed major tax cut legislation, eliminating the $400 professional privilege tax levied on licensed individuals annually in 15 professions in Tennessee.

This, according to a press release legislators sent out this week.

Senate Bill 398, sponsored by Senator Brian Kelsey, R-Germantown, repeals the tax for accountants, architects, sports agents, audiologists, chiropractors, dentists, engineers, landscape architects, optometrists, pharmacists, podiatrists, psychologists, real estate brokers, speech pathologists, and veterinarians.

“The idea that earning a living is a privilege is insulting to hardworking Tennesseans,” the press release quoted Kelsey as saying.

“For many years, this tax has unfairly singled out individuals in 22 of the state’s 100 licensed professions by taxing them for the so-called ‘privilege’ of earning a living.  I am very pleased that it will end for the majority of these taxpayers.”

Action on the legislation comes after a 2016 Tennessee Advisory Commission on Intergovernmental Relations report said some professions in the state that are not taxed have higher average incomes.  The report also noted that incomes of professionals vary significantly within the taxed professions and those in occupations earning lower salaries, pay the same amount as those earning more.  Professionals in these areas must pay the tax annually even when they conduct no business.  Tennessee is one of only six states that impose a professional privilege tax, the press release said.

Kelsey said he would continue efforts next year to repeal the for the remaining seven professions with tax relief funds set aside by the General Assembly.  Lawmakers want to offset a windfall of online sales tax revenue expected to be realized as a result of the U.S. Supreme Court’s Wayfair decision with additional tax relief.   The decision allowed states to collect online sales taxes, the press release said.

“First, the General Assembly repealed the gift tax and eliminated the inheritance tax through a four-year phase out in 2012.  Then we passed my constitutional amendment prohibiting the state income tax in 2013, which was approved by the people of Tennessee in 2014,” the press release quoted Kelsey as saying.

“We also phased out of the Hall Tax on interests and dividends beginning in 2016, which will continue over the next two years.  This is in addition to cutting the sales tax on groceries by almost 30 percent.  In the meantime, we have implemented efficient and effective budgeting practices that save taxpayer dollars.  I am thrilled that we have now repealed the professional privilege tax for 15 different professions.”

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Chris Butler is an investigative journalist at The Tennessee Star. Follow Chris on Facebook. Email tips to [email protected]







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3 Thoughts to “Tennessee General Assembly Approves Legislation Eliminating Professional Privilege Tax”

  1. Horatio Bunce

    Kelseyville forgot to include his amendment removing the ability for Tennesseans to elect the judicial branch, now co-opted by the legislative and executive branches, same as it has been since the Democrat’s illegal Tennessee Plan that the Republicans continued.

    The U.S. Constitution plainly states that imports and exports between states may only be taxed by a state to the extent of the costs of inspections of those imports/exports. Any amount above the cost of those inspections is to be remitted to the U.S. Treasury. So, of course the SCOTUS would agree they can charge tax..but these fools will soon have the rug pulled from under them…since the State of TN is expending zero effort inspecting the vast majority of those imports/exports, not to mention providing no services of any kind in the states we import from. This money-for-nothing scheme will not last.

    1. Josh Read

      Horatio: Remember the limerick, ‘He stuck in his thumb and pulled out a plumb and said, “What a big boy am I” ?’ That’s what we’re dealing with here. The downstream consequences of the TN integrated Bar’s UN-elected Appellate Judiciary is only beginning to be felt in Tennessee. The judicial branch aggregation of political power, in addition to the TSC appointment of the Attorney General plus all legal oversight commissions is only beginning to be felt in Tennessee.
      Consider if the Mueller report had landed into the hands of Tennessee AG Herbert Slatery III.

      1. Horatio Bunce

        He would get his phone and hit speed dial to Hedy Weinberg to see what the ACLU wants him to do, regardless of the actions of the legislature. At least that is what we are made to think happens with most TN AG “opinions” these days. It’s a fairly convincing game of smoke and mirrors. But after the Kelseys, Overbeys and Norris’ have declared themselves the “qualified voters of the state” to make all decisions for the mere taxpayers, they assume the fetal position and forget they have assumed all that appointing power of the AG and his Bar Selectors. Funny how that works.