Tennessee Senate Bill SB0574

Tennessee 2025-2026 Regular Session

• Introduced: 1/30/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 57, Chapter 5 and Title 67, Chapter 4, relative to the taxation of certain beverages.

Summary

SB0574 reduces Tennessee’s beer and bottled soft drink tax rates and redirects portions of the resulting revenue to litter prevention and recycling programs. For beer and similar beverages taxed under Title 57, the bill lowers the special privilege tax from $4.29 per barrel to $2.00 per barrel. For bottled soft drinks taxed under Title 67, the bill keeps the existing gross receipts tax structure but requires that 0.5% of the revenue be allocated to the highway fund for litter and trash prevention and collection programs, and 0.4% be allocated to recycling grants administered by the Department of Environment and Conservation. The bill also changes how existing beverage-tax revenue is used by limiting certain current provisions to before July 1, 2025, and it adds repeal triggers tied to future beverage container deposit laws or July 1, 2028, whichever comes first. It requires annual reporting by the Department of Transportation and the Department of Environment and Conservation on the programs funded and the amounts spent. The Tennessee Code Commission is directed to remove references to the repealed taxes when applicable.

Impact

The bill amends Tennessee Code Annotated Titles 57 and 67 by lowering the beer special privilege tax, preserving the bottled soft drink privilege tax but earmarking specified portions of revenue for environmental and transportation-related purposes, and setting sunset/repeal conditions tied to future container deposit legislation or 2028. It affects beer distributors, brewers, beverage manufacturers, soft drink producers, importers, and state agencies responsible for litter prevention, recycling grants, and reporting. It also changes the flow of tax revenue into the highway fund and recycling programs, while requiring future code cleanup if the taxes are repealed.

Sentiment

Based on the bill text and the absence of recorded committee discussion or votes in the provided materials, the overall sentiment appears policy-driven and administrative rather than overtly contentious. The measure reflects support for reducing certain beverage tax burdens while dedicating revenue to litter control and recycling, suggesting a mix of tax relief and environmental stewardship. No formal vote history or transcript comments are available to indicate broader legislative support or opposition.

Contention

The main points of potential contention are the reduction in the beer tax rate, which may be viewed as a tax cut for the beverage industry but a revenue reduction for the state, and the earmarking of beverage-tax revenue for litter and recycling programs, which may draw scrutiny over fund allocation priorities. Another possible point of debate is the sunset/repeal mechanism tied to future bottle deposit laws or the 2028 deadline, because it links the tax structure to a broader policy change that could affect retailers, manufacturers, and environmental stakeholders. No specific opposing viewpoints are documented in the provided materials.