(NASHVILLE, TN), May 18, 2011 – A “No State Income Tax” constitutional amendment passed the Senate today by a vote of 26 to 4. Senate Joint Resolution 221, sponsored by Senator Brian Kelsey (R-Germantown) would clarify a prohibition in the Tennessee Constitution against an income tax and a payroll tax. The Senate action marks the first victory for the resolution in a series of approvals required under Tennessee’s Constitution before the proposed amendment can be considered by voters on the ballot. The resolution will be taken up tomorrow morning by the state House for the first of three successive readings, and it could pass the House as early as Saturday.
“Not having a state income tax has already brought jobs to Tennessee,” said Senator Kelsey. “If this amendment passes, we will be able to tell prospective businesses that we will never have an income tax in our state, a condition which will help Tennessee become the number one state in the Southeast for high quality jobs.”
In order for a constitutional amendment to pass, it must first be approved by a simple majority in both the House and the Senate this year. Then, it must be approved by a two-thirds vote in each chamber during the next General Assembly in 2013-2014 before it goes to voters for final consideration on the November 2014 ballot.
The resolution specifies that the state legislature as well as Tennessee cities and counties shall be prohibited from passing either an income tax or a payroll tax, which is a tax on employers that is measured by the wages they pay their workers. A payroll tax has been proposed in recent years by elected officials in Shelby County as a way around an income tax.
Kelsey won passage of a similar resolution by a vote of 28-5 earlier this year, but the House redrafted the resolution more succinctly. The version that passed the Senate today matches the version that is up for consideration in the House tomorrow.
“I am pleased that this resolution passed with such an overwhelming, bipartisan majority,” added Kelsey. “I am glad that the House will take up the resolution tomorrow, and I hope they will pass it Saturday, so we can move even closer to closing the door on the income tax battle forever.”