The Tennessee House of Representatives voted 68-20 on Monday to pass the largest business tax cut bill in state history.
The House’s bill version, SB 2103/HB 1893, would refund $713.6 million or one year of franchise tax.
Under the amended House version of the bill, businesses who paid into the franchise and excise tax in the last year have until February 3, 2025 to claim a refund for those taxes or sue the state to get the funds back.
The amended House bill also requires businesses seeking a refund to “waive any claim or right to file suit alleging the franchise tax is unconstitutional as it existed prior to this legislation.”
House Majority Leader William Lamberth (R-Portland), who sponsored the bill, said cutting the franchise tax for businesses makes the state of Tennessee “more competitive” in regards to attracting business away from other states.
“It’s simply a policy debate on whether or not we should cut the franchise taxes going forward, making us more competitive to other states to be able to attract businesses and retain businesses,” Lamberth said. “It’s one of the biggest business tax cuts to business that you will probably ever see in your time in the legislature for as long as you may serve here. It’s certainly one of the biggest ones that I’ve seen, and it’s really good public policy.”
Before the bill passed on Monday, State Democrats, including State Representatives Justin Jones (D-Nashville) and Justin Pearson (D-Memphis), branded the bill as “trickle-down” economics.
Only one Democrat, State Representative Johnny Shaw (D-Bolivar), voted with the majority of Republicans to pass the bill.
Last month, the Senate passed a version of the bill worth three years of franchise taxes for an estimated $1.6 billion.
The House version of the bill now returns to the Tennessee Senate where lawmakers must decide to adopt the bill as-is or debate it in a conference committee.
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Kaitlin Housler is a reporter at The Tennessee Star and The Star News Network. Follow Kaitlin on X / Twitter.
Tax breaks for businesses but nary one for us citizens.
What happened to the bill that would end tax on grocery items? I guess we peons need to hire us a lobbyist.
Tennessee state government: Of Business, By Business, For Business.