Tennessee – State Issues Update On Sales Tax Applicability In Reaction To The Recent Wayfair SCOTUS Decision

The Tennessee Department of Revenue has just issued a special notice that provides some additional guidance regarding how Tennessee is reacting to the recent South Dakota vs. Wayfair U.S. Supreme Court decision.  Please click to take you to the Department of Revenue’s website to view the Special Notice #18-11.

The bottom line is that for now there is no change in Tennessee’s application of sales tax to sales made into Tennessee by out-of-state vendors with no physical presence in Tennessee. They also indicate they will promptly advise when the effective date the change will take place.

Even though Tennessee has already passed a law establishing an “economic nexus” rule that aligns with the Supreme Court decision, that law has been prohibited from being enforced by the legislature until the department fully reviews the Supreme Court ruling and decides how to proceed. They do indicate that at some point this application will change to align with the Supreme Court ruling and Tennessee’s economic nexus law.

They do however encourage taxpayers to voluntary comply with the new decision and Tennessee’s law and for such taxpayers to begin charging and collecting Tennessee sales tax.

There is also some very good news in the notice in that it indicates that as of the date the rule does eventually go into effect in Tennessee, there will be no retroactivity. So when the department does announce a date in which these new rules become effective in Tennessee, there will be no assessment by the Department of Revenue on that basis prior to that date.

In the Notice #18-11, provided is a way to sign up to receive notification when the department does issue the effective date of the changes.

Nashville Business Journal
by Mark Loftis
September 7, 2018

For More Information:
Nashville Business Journal
TN – Sales 18-11


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