Taxes and Incentives
Low taxes—or no taxes—mean a better bottom line for Tennessee businesses:
- No personal income tax
- No state sales tax on manufacturing equipment for qualified businesses
- No sales tax on pollution control equipment
- No sales tax on raw material
Tennessee offers many other business tax incentives, including:
- Reduced sales tax on energy fuel and water for qualified manufacturers
- “Double weighting” of Tennessee sales for franchise and excise taxes
- 1% tax credit on capital equipment
- Jobs tax credit of $2,000 per employee ($4,500 for specially designated counties)
Local incentives make the Innovation Valley an especially favorable area for business:
- PILOT (Payment in Lieu of Taxes) tax freeze on a portion of local real and personal property for a duration dependent on location and other variables such as total capital investment, net new jobs, and wages
- Development of infrastructure and site preparation work required to make a site buildable; determined on a case-by-case basis
- Local training grants for skilled workforce positions
- Land price discounts for potential businesses; determined on a case-by-case basis
More information on state incentives at Tennessee Department of Economic and Community Development.
