Tennessee Senate Bill SB1095

Tennessee 2025-2026 Regular Session

• Introduced: 2/5/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 67, Chapter 6, Part 3, relative to exemptions from sales and use tax.

Summary

SB1095 creates a new sales tax exemption for the first $20 of the sales price of tangible personal property when the purchase is paid for with physical cash. The bill defines “physical cash” to include coins, paper money, notes declared legal tender by state or federal law, and also physical gold and silver. The exemption applies only to the state sales and use tax chapter amended by the bill and does not eliminate other taxes that may apply under separate laws. In practical terms, the measure would give a small tax break to cash transactions at the point of sale, while leaving non-cash purchases unchanged. It would also extend the definition of cash for this limited purpose to include tangible precious metals, which could affect how certain transactions are treated if paid with gold or silver in physical form. The act is scheduled to take effect July 1, 2025.

Impact

The bill amends Tennessee Code Annotated, Title 67, Chapter 6, Part 3, by adding a new exemption from sales and use tax for the first $20 of tangible personal property sold and paid for with physical cash. It would reduce taxable sales receipts for qualifying cash transactions and could modestly lower state sales tax collections on small purchases. The bill expressly preserves other taxes imposed under different statutes, so it does not broadly exempt these transactions from all state or local tax obligations.

Sentiment

No committee transcripts or recorded votes were provided, so there is no direct evidence of legislative debate or formal support/opposition in the materials supplied. Based on the text alone, the bill appears to be a targeted tax-relief measure aimed at cash purchases, with a narrow and specific scope. The absence of recorded discussion makes the overall sentiment difficult to gauge beyond the bill’s straightforward pro-exemption framing.

Contention

The main potential point of contention is the policy choice to favor cash transactions over electronic payments, which could be viewed as encouraging cash use or creating unequal treatment among payment methods. Another possible issue is the inclusion of physical gold and silver in the definition of “physical cash,” which may raise questions about administration, valuation, and whether such transactions should receive the same tax treatment as ordinary currency. Because no debate transcript is available, it is not possible to attribute these concerns to any specific legislator or stakeholder from the provided record.