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Mayors across the state are supporting a bill to restore the sales tax percent cities receive


Back in 1947, Tennessee began sharing 4.6 percent of each year's total sales tax collections with cities.

Then in 2002, during a financial crisis, the state increased the sales tax rate from 6 to 7 percent- but state lawmakers did not raise the share for the cities.

The same is true for single-article taxes,

“You go buy a car, your local sales tax is 2.75% on that car, but you only pay that for the first 1600 when the state in 2002. They raised that to 3200. But the state kept all of the six, the new 1600 they added to that," said Henderson Mayor Bobby King.

King says the state is in a much better place financially and could afford to raise the amount it shares with cities, “Today, states got like 9.3 billion in their rainy-day fund. And what we're asking, you know, 90% of all local sales tax is generated in the cities. And what we're asking them to do is to do that sharing. They've always done with this to restock and restore that.”

Nearly 350 mayors across the state are backing a bill that would do just that.

The bill would move the amount of sales tax that cities get from 4.6 percent to a little more than 5 percent.

“For me, it's like $113,000 a year," said King. "For city of Jackson, it's like 1.25 million. So it is a reoccurring money every year that’s very important," he continued.

King points out that over the last 20 years, cities across the state have lost over 2 billion dollars because the state did not raise the percentage cities received.

That’s money King says the cities can use on their cities, “The city taxpayers are paying this now. It's just all going to the state. They have no control over where it goes. The deal is it comes back to the cities that are producing that sales tax to use in that city," Mayor King said.

King says he and the other mayors are hopefully that the state will raise the percent they receive back to the rate that it was.

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