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SB 1081

Taxes, Sales - As introduced, requires the commissioner of revenue to establish a sales tax remittance schedule that allows dealers making sales to reasonably offset the burden of transaction fees associated with the collection of sales tax. - Amends TCA Title 67, Chapter 6.

114th Regular Session (2025-2026)

Tennessee bill requiring the state to allow retailers to offset payment processing fees when remitting sales taxes, potentially reducing state revenue or increasing administrative burden.

Assigned to General Subcommittee of Senate Finance, Ways & Means Committee
#sales #taxes
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Bill Summary · SB 1081

Legislative bill overview

SB 1081 requires Tennessee's Commissioner of Revenue to create a sales tax remittance schedule that allows retailers to offset the costs of payment processing fees incurred when collecting sales taxes. This addresses the practical burden retailers face when paying sales tax to the state while absorbing credit card and payment processing fees.

Why is this important

Retailers currently must remit collected sales tax to the state while independently absorbing the transaction fees charged by payment processors—effectively reducing their margins on tax collection. This bill seeks to formalize a mechanism where the state acknowledges these costs, potentially through adjusted remittance schedules or allowances, which could improve cash flow for small and mid-sized retailers.

Potential points of contention

  • State revenue impact: Any allowance or offset could reduce state tax revenue or require defining which fees qualify, creating administrative complexity and potential disputes
  • Retailer vs. consumer burden: Opponents may argue retailers should absorb these fees as a cost of doing business, while proponents contend the state benefits from tax collection efficiency
  • Implementation challenges: Establishing a standardized schedule across diverse payment methods and processor fees presents practical difficulties; defining "reasonable offset" amounts will be contentious
  • Competitive effects: Different retailers use different payment systems with varying fee structures, making uniform schedules potentially inequitable

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

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