Tennessee House Bill HB2671

Tennessee 2023-2024 Regular Session

• Introduced: 1/31/24

Caption

AN ACT to amend Tennessee Code Annotated, Title 67, Chapter 4, Part 30, relative to the Local Tourism Development Zone Business Tax Act.

Impact

The amendments suggested by HB2671 are expected to have significant implications for local economies that rely on tourism revenue. By increasing the business tax rate, the bill aims to enhance funding available for local tourism projects and infrastructure, which could potentially lead to boosted tourism activities and further economic development in these areas. However, this increase could also present a financial burden on local businesses, raising concerns about their ability to sustain operations under a higher tax liability.

Summary

House Bill 2671 (HB2671) proposes amendments to the Local Tourism Development Zone Business Tax Act within the Tennessee Code Annotated. The key changes involve increasing the tax rate from ten percent (10%) to fifteen percent (15%) on businesses operating within designated tourism development zones. Additionally, the bill extends the timeframe for certain compliance matters from thirty days to forty-five days, thereby providing businesses with more time to meet regulatory requirements.

Contention

Discussions around HB2671 have brought to light differing opinions regarding its economic impact. Proponents argue that the enhanced revenue from the increased tax rate will provide vital support for local tourism initiatives, ultimately benefiting the community. However, opponents raise concerns that the tax hike could deter businesses from operating in these areas, potentially discouraging new investments in local tourism. The extended compliance timeframe has also been debated, with some arguing that it could lead to inefficiencies, while others see it as a reasonable adjustment for business flexibility.