The University of Tennessee, Knoxville

Tennessee County Municipal Advisory Service

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Wholesale Liquor Tax

Reference Number: MTAS-1856
Tennessee Code Annotated
Reviewed Date: September 14, 2016
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Revenue Class: Local Taxes

Fund: General

Account No.: 31720

Description: State authorized tax on wholesale sales of liquor. City must pass an ordinance to impose an inspection fee upon licensed retailers of alcoholic beverages or upon retail food store wine licensees located within such municipality.

Authorization: T.C.A. § 57-3-501 et seq.

Requirements or Restrictions: As delineated in T.C.A.

Current Rate: Depending upon the size of municipality’s county, the municipality levies by ordinance a 5 percent or 8 percent inspection fee that is collected by the wholesalers from the retailer during distribution. The wholesalers then retain 5 percent of the fee for performing the collection. The fee cannot exceed 8 percent of the wholesale price of alcoholic beverages sold in municipalities located in counties having a population of less than 60,000; and cannot exceed 5 percent for municipalities located in counties having a population more than 60,000.

Frequency of Payment: Monthly by the 20th.

Late Pay Penalty: A penalty of 10 percent is assessed after the 20th of each month. T.C.A. § 57-3-503(b).

Exemptions: None.

Collection: The inspection fee is collected by the wholesaler from the retailer and remitted by wholesalers to the municipality monthly on municipal-prescribed form.

Use Restrictions: None.

Responsible: