Tennessee House Bill HB1682

Tennessee 2025-2026 Regular Session

• Introduced: 1/14/26
• Refer: 1/21/26

Caption

AN ACT to amend Tennessee Code Annotated, Title 67, Chapter 6, relative to the taxation of labor performed on tangible personal property.

Summary

HB1682 revises Tennessee’s sales and use tax rules for labor performed on tangible personal property. The bill removes language that had treated certain labor or service costs as part of the taxable base, deletes one existing subdivision defining taxable labor-related charges, and adds a new provision stating that labor and service costs, including repair and installation labor charges, are taxable only when they are separately stated on an invoice or similar billing document given to the purchaser. The bill also makes conforming changes to related statutory provisions in Title 67, Chapter 6, including deleting specified exemptions or cross-references and renumbering remaining subdivisions. In practical terms, it appears aimed at clarifying when labor charges connected to repairs or installation on tangible personal property are subject to tax, and at aligning the tax code with the new invoice-separation requirement. The act takes effect July 1, 2026, with immediate effect only for rulemaking purposes.

Impact

HB1682 would amend Tennessee Code Annotated Title 67, Chapter 6, affecting the state’s sales and use tax treatment of labor and service charges tied to tangible personal property. It would narrow or clarify the taxable treatment of repair and installation labor by tying taxability to whether those charges are separately stated on billing documents, while also making related conforming deletions and renumbering in the tax code. Businesses that perform repairs, installations, or similar services, as well as purchasers of those services, would be directly affected by the revised invoicing and tax-collection rules.

Sentiment

No committee transcripts or recorded votes were provided, so there is no direct evidence of debate, support, or opposition in the available materials. Based on the bill text alone, the measure appears technical and administrative in nature, focused on clarifying tax administration rather than making a broad policy change. The absence of recorded discussion suggests sentiment cannot be reliably characterized from the provided record.

Contention

The main potential point of contention is the tax treatment of labor and service charges on tangible personal property, especially repair and installation labor. Businesses may favor clearer rules and the ability to separate taxable from nontaxable charges on invoices, while tax administrators or other stakeholders may be concerned about revenue effects, compliance burdens, or whether the bill narrows the tax base. Because no committee discussion or votes are included, specific positions by legislators or interest groups are not available.