2023 Tennessee Code › Title 67 - TAXES AND LICENSES (§§ 67-1-101 — 67-10-107) › Chapter 4 - PRIVILEGE AND EXCISE TAXES (§§ 67-4-101 — 67-4-3206) › Part 4 - GENERAL REVENUE LAW - PRIVILEGES TAXABLE BY STATE ONLY (§§ 67-4-401 — 67-4-411) › Section 67-4-402 - [Contingent repeal date. See subdivision (b)

(a)
Definitions.
As used in this section, unless the context otherwise requires:
(1)
"Bottled soft drinks" includes any and all nonalcoholic beverages, whether carbonated or not, such as soda water, cola drinks, orangeade, grapeade, gingerale and the like, and all bottled preparations commonly referred to as soft drinks of whatever kind or description that are closed and sealed in glass, paper, metal, plastic, or any type of container or bottle, whether manufactured with or without the use of syrup. Fluid milk with or without flavoring, natural undiluted fruit juice or vegetable juice, cider, and pure fruit juice concentrate to which no additive has been made, with only water being necessary to be added to restore the juice to its natural state, are exempted from this section; and
(2)
"Nonalcoholic beverages" means all beverages containing less than one-half of one percent (0.5%) alcohol by volume.
(b)
(1)
Imposition of Tax.
A person manufacturing or producing and selling within this state any bottled soft drinks and a person importing or causing to be imported bottled soft drinks into this state from outside the state and selling such imported bottled soft drinks within this state shall, for the privilege of engaging in such business, pay to the state for state purposes an amount equal to one and nine-tenths percent (1.9%) of the person's gross receipts derived from such business; provided, that the rate shall be reduced by four-tenths of one percent (0.4%) on July 1 of any year following the enactment of any state or federal law that imposes mandatory deposits by consumers on beverage containers sold in this state or on July 1, 2028, whichever occurs first.
(2)
Notwithstanding this section or another law to the contrary, any revenue generated from the increase in tax rates from one and one-half percent (1.5%) to one and nine-tenths percent (1.9%) must be allocated to the highway fund for the purpose of funding programs for the prevention and collection of litter and trash and matters related to the programs, including special grants for programs described in §
54-1-407
. No later than March 31 of each year, the department of transportation shall transmit to the governor, the speaker of the house of representatives and the speaker of the senate a report listing the programs receiving funds generated by this subsection (b), the amount of funds received by each program, and the purpose for which the funds were spent. This subdivision (b)(2) shall be repealed on July 1 of any year following the enactment of any state or federal law that imposes mandatory deposits by consumers on beverage containers sold in this state or on July 1, 2028, whichever occurs first.
(3)
A person located outside this state who distributes bottled soft drinks in this state shall, for the privilege of engaging in such business, pay the tax on gross receipts derived from bottled soft drinks distributed by the person in this state in the same manner as does a person located in this state.
(4)
A person importing or causing to be imported bottled soft drinks into this state from outside the state and selling such imported soft drinks within this state is not required to pay the tax, if the person's out-of-state supplier of bottled soft drinks has paid the tax as stated in subdivision (b)(3).
(5)
The tax shall be administered and collected by the commissioner under chapter 1, part 14 of this title and parts 2 and 3 of this chapter.
(c)
Exemptions.
A person who is subject to and pays this tax is not liable for the tax on gross receipts derived from the person's sales of bottled soft drinks outside this state.
(d)
(1)
Any taxes paid pursuant to parts 20 and 21 of this chapter on the business taxed by this section shall be a credit against the tax imposed by this section.
(2)
The credit taken on any return shall not, however, exceed seventy-eight and ninety-five hundredths percent (78.95%) of the tax liability shown on any tax return.
(3)
No credit shall be taken on any return for taxes paid pursuant to parts 20 and 21 of this chapter, unless such taxes are paid for the corresponding tax base period on which the tax levied by this section is based; provided, that the credit allowed under this subsection (d) shall be for taxes only, and no credit shall be allowed for penalty and interest.
Amended by 2022 Tenn. Acts, ch. 903, s 2, eff. 7/1/2022.
Amended by 2021 Tenn. Acts, ch. 158, Secs.s3, s4 eff. 7/1/2021.
Amended by 2016 Tenn. Acts, ch. 704, s 4, eff. 6/1/2016.
Amended by 2016 Tenn. Acts, ch. 704, s 3, eff. 6/1/2016.
Acts 1937, ch. 108, art. 2, § 2, Item A; 1941, ch. 51, § 17; 1947, ch. 170, § 1; 1949, ch. 219, § 1; C. Supp. 1950, § 1248.3, Item B (Williams, § 1248.120); Acts 1955, ch. 309, §§ 1, 2; 1957, ch. 227, §§ 1, 2; 1957, ch. 385, § 1; 1957, ch. 393, § 1; impl. am. Acts 1959, ch. 9, § 14; Acts 1963, ch. 35, §§ 1, 2; 1972, ch. 476, § 1; 1973, ch. 20, § 1; 1978, ch. 510, §§ 1-3; 1981, ch. 307, §§ 3, 4; T.C.A. (orig. ed.), § 67-4102, Item B; Acts 1984, ch. 769, § 1; 1987, ch. 33, § 1; 1988, ch. 573, § 1; 1991, ch. 30, § 1; 1995, ch. 2, § 1; 1999, ch. 81, § 2; 1999, ch. 406, § 9; 2005, ch. 86, § 1; 2010 , ch. 616, § 1.