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HB 2502

Banks and Financial Institutions - As introduced, classifies a money transmission originating in this state to a location outside of the United States or its territories as a service transaction subject to the sales and use tax; requires revenues from such tax to be allocated to certain purposes. - Amends TCA Title 4; Title 38; Title 39; Title 45; Title 47; Title 49 and Title 67.

114th Regular Session (2025-2026) Introduced by Cameron Sexton

Tennessee would tax international money transfers as service transactions, generating state revenue with primary impact on immigrant and international business remittance users.

Senate substituted House Bill for companion Senate Bill.
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WeVote Research Nonpartisan
Bill Summary · HB 2502

Legislative bill overview

HB 2502 would classify international money transfers originating in Tennessee as taxable service transactions subject to sales and use tax. The bill amends multiple sections of Tennessee law to implement this tax and directs the resulting revenue to unspecified purposes (as detailed elsewhere in the legislation).

Why is this important

This would create a new tax on a specific financial service used by immigrants sending remittances, international businesses, and individuals with overseas connections. The revenue impact depends on transfer volumes, but remittances are a significant economic activity—particularly in communities with immigrant populations—making this a meaningful source of state revenue with concentrated effects on certain populations.

Potential points of contention

  • Disproportionate impact on immigrant communities: Money transfers are heavily used by immigrants sending funds to family abroad; the tax would effectively burden this population more heavily than others
  • Competitiveness concerns: The tax could push customers toward services in neighboring states or unregulated alternatives, potentially reducing state tax revenue and regulatory oversight
  • Definitional ambiguity: "Money transmission" has complex regulatory boundaries; unclear how this interacts with existing federal banking regulations and whether it captures cryptocurrency transfers, wire services, and informal transfers differently
  • Revenue allocation uncertainty: The bill's actual purpose for collected funds is not specified in this summary, making it difficult to assess whether the tax serves a public need or is primarily revenue-raising

Compiled from official sources — confirm details with the bill’s official record.

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