Single Article and Special Tax Rates
Single Article Local Tax Base Limitation
The local tax is applied only to the first $1600 of the sales price of any single article of tangible personal property in most local jurisdictions.
A single article of tangible personal property is defined as one item, exclusive of accessories, that is capable of being sold by the seller as an independent unit or common unit of measure. The single article local tax base limitation applies to each commonly understood single item of tangible personal property. The single article local tax limitation does not apply to a single invoice total when multiple items of tangible personal property are included on the invoice. Note, the price of motor vehicle and boat dealer installed accessories sold in conjunction with a motor vehicle or boat are to be included the price that is subject to the single article local tax limitation. The entire sales price of custom (non-prewritten) computer software, computer software maintenance contracts, services, amusements, specified digital products, and warranty or service contracts covering tangible personal property is subject to local tax. The single article local tax limitation does not apply to such sales.
To determine the amount of local tax, multiply the sales price of a single article of tangible personal property, up to the local tax base limitation (usually $1,600), by the local tax rate. The local tax will not apply to any portion of the price of a single article of tangible personal property that exceeds the local tax base limitation for that local jurisdiction. See the Single Article Local Tax Base Limitation chart.
Special State Tax Rates
|State Tax Rate||Reference|
|Food and food ingredients||4.0%||Tenn. Code Ann. §67-6-228|
|Aviation fuel||4.25%||Tenn. Code Ann. §67-6-217|
|Industrial water for manufacturers||1.0%||Tenn. Code Ann. §67-6-206|
|Industrial energy fuel for manufacturers||1.5%||Tenn. Code Ann. §67-6-206|
|Electricity for qualified data center||1.5%||Tenn. Code Ann. §67-6-206|
|Interstate and international telecommunications sold to business||7.5%||Tenn. Code Ann. §67-6-221|
|Manufactured homes (tax at 1/2 general state tax rate)||3.5%||Tenn. Code Ann. §67-6-216|
|Video programming services (cable TV monthly charge from $15.01-$27.50)||8.25%||Tenn. Code Ann. §67-6-226|
|Direct-to-home satellite television services||8.25%||Tenn. Code Ann. §67-6-227|
|Qualified common carriers direct pay use tax on Tennessee purchases of tangible property that is used outside the state||3.75%||Tenn. Code Ann. §67-6-219|