Section 1320-05-02-.02 - COLLECTION OF LOCAL SALES TAX(1) Any local government imposing a local sales tax may provide that it will collect its tax by means of its own officers and employees; promulgate rules and regulations which are not inconsistent with the state and sales and use tax law or the rules and regulations promulgated thereunder; adopt the state rules and regulations as they may be promulgated or changed form time to time; adopt provisions imposing penalty and interest; and use the same powers that are available to the Commissioner to administer the state sales tax law, make refunds for tax, penalty and/or interest collected improperly, and enforce payment by means of distress warrants, liens, injunction, etc. Provided, however, that no local government collection its own tax may prescribe or require a bracket system for the shifting of the tax burden to the consumer of tangible personal property or services, such bracket system being calculated to include the amount of the state tax in addition to the local tax, unless such bracket system shall be been approved specifically by the Commissioner.(2) The Commissioner an the Department shall deem it feasible to collect, and shall collect any local sales tax under the following conditions. (a) The resolution or ordinance imposing the local sales tax shall provide that:1. The Department shall collect the sales or use tax, penalty and interest.2. Penalty and interest shall be imposed and collected in the same manner as the penalty and interest is imposed and collected by and for the state.3. The state rules and regulations as promulgated and as may be amended, changed, added or rescinded by the Commissioner for the state sales tax shall apply to the local sales tax and the administration of the local tax.4. A local official shall be designated to receive any notice of a payment made under protest to the Commissioner, which the Commissioner will give to the county, city or town, and be the official against whom suit, if any, may be brought for recovery of any tax, penalty and interest which the Commissioner has collected and which is alleged by the taxpayer to be illegal or improper.(b) The Commissioner shall have the right to, and shall proceed to do all things necessary to collect the tax, penalty and interest, enforce payment by any means available now and later available to the state to collect the state sales tax, make any necessary adjustments and refunds of the locally imposed tax, penalty and interest as may be necessary, and file any claims necessary in any court involving delinquent, insolvent, or bankrupt taxpayers, for the locally imposed tax, penalty and interest.(c) The Commissioner shall undertake to defend any locally imposed tax insofar as a determination of the state tax will govern liability for a local sales tax, in the courts of Davidson County, Tennessee, only. Where there is no determination of a state tax to be made, and there is an alleged illegal payment to the Commissioner and suit is brought to recover the payment, the officer designated in the resolution or ordinance imposing the tax shall be named as the defendant, and shall do all things necessary to defend the action; such action shall be brought in the courts of the county where the tax is imposed.(d) The county, city, or town imposing the local sales tax shall agree to pay a sufficient amount to the Commissioner to reimburse the Department for any costs involved in administering the local sales tax.(e) The combined state and local tax rate must be a multiple of .25. Example: 7.75% but not 7.875%.Tenn. Comp. R. & Regs. 1320-05-02-.02
Original rule certified June 7, 1974. Amendment filed February 14, 1990; effective April 1, 1990.Authority: T.C.A. §§ 67-1-101, 67-6-402 and 67-3045.