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Tennessee House, Senate at impasse on franchise tax repeal, rebate


(The Center Square) – Members of a Tennessee conference committee on the repeal and refund of the state’s business franchise tax are at an impasse and went into recess after less than 10 minutes of discussion on Tuesday morning.

The main points of contention on the bill are the length of time the rebate will cover – one year in the House version, three in the Senate – and whether the names of businesses receiving the rebate should be made public.

Neither side would back down on either issue.

“Right now, we do not have a bill,” said House Majority Leader William Lamberth. “And so, if we do not pass a bill, obviously none of that would be necessary.

“My hopes are not high at this juncture.”

The House version of Senate Bill 2103 would refund $713.6 million or one year of franchise tax while the Senate passed a version worth three years of franchise taxes for an estimated $1.6 billion.

Sen. Jack Johnson, R-Franklin, said the Senate would agree on having company’s sign a waiver not to sue the state regarding the franchise tax before accepting the rebate and would agree to have companies required to first use any outstanding Department of Economic and Community Development tax credits to offset the refund amount.

“I don’t know that there is a pathway at this juncture to proceed,” Johnson said.

Sen. Bo Watson, R-Hixson, suggested Tennessee Attorney General Jonathan Skrmetti, the Department of Revenue and Gov. Bill Lee’s office give testimony at any future meeting of the committee.

Johnson said further announcements on conference committee meetings would come during a full session of the Senate.

“I would say that we are at an impasse as it relates to being able to find a solution because I really feel like the House’s version is the one that we’re going to stick with,” said Rep. Ryan Williams, R-Cookeville.