Tennessee imposes two separate taxes on beer with an alcohol content of 8% by weight or less.
Beer Barrelage Tax
Tennessee imposes a beer barrelage tax on the privilege of storing, selling, distributing, or manufacturing beer. If beer is distributed through a Tennessee wholesaler, the wholesaler is responsible for paying the barrelage tax. However, a beer manufacturer is responsible for the barrelage tax when: 1) it operates as a retailer and sells its beer to other retailers within the same county, or 2) when it operates as a retailer or holds a license as a restaurant, limited service restaurant, or hotel.
Wholesale Beer Tax
Tennessee also imposes a wholesale tax on each case of beer sold at wholesale in the state. Wholesalers are generally responsible for paying this tax. However, a beer manufacturer that self-distributes in its own county is responsible for the wholesale beer tax.
Manufacturer and Wholesaler Registration
Beer manufacturers/importers and wholesalers must register with the Department on an annual basis and pay a registration fee.
Tennessee has a three-tier system for distributing beer. Generally, a licensed retailer may only purchase beer from a licensed wholesaler, a licensed wholesaler may only purchase beer from a licensed manufacturer/importer, and neither a licensed manufacturer/importer nor a licensed wholesaler may sell beer directly to a consumer. However, there are limited exceptions.