Tennessee has a 7% state-wide sales tax, and local jurisdictions impose additional sales taxes of up to 2.75%. If you sell taxable goods or services in Tennessee, you may be required to register, collect, and remit sales tax.
Whether you operate a local business in Tennessee, sell through your own ecommerce website, or are an out-of-state seller that has exceeded the state’s economic nexus threshold, understanding your obligations is essential to staying compliant.
Tennessee Sales Tax at a Glance (2026)
| Topic | Key Information |
| State sales tax | 7% |
| Local sales taxes | Up to 2.75% |
| Qualifying food rate | 4% state rate |
| Economic nexus | $100,000 in sales |
| Sales tax permit | Required when applicable |
| Filing frequency | Monthly, quarterly or annually |
| Registration and filing | TNTAP |
When Do You Have Sales Tax Nexus in Tennessee?
You generally have sales tax nexus if your business:
- Has a storefront, office, warehouse, employees, or inventory in Tennessee.
- Uses a third-party fulfillment center located in Tennessee.
- Has more than $100,000 in sales to Tennessee customers during the previous 12-month period.
If you meet these requirements, you’ll generally need to register and begin collecting Tennessee sales tax.
What Is Taxable in Tennessee?
Tennessee generally taxes retail sales of tangible personal property, specified digital products, and certain services. Taxable transactions commonly include:
- Clothing
- Electronics
- Furniture
- Appliances
- Household goods
- Prewritten computer software
- Specified digital products
- Certain repair and installation services
- Certain telecommunications services
Unlike states that broadly tax services, Tennessee generally taxes services only when they are specifically identified as taxable under state law.
Tennessee Food Sales Tax
Common exemptions include qualifying resale transactions, certain medical products, and other purchases specifically exempted under Tennessee law. Businesses should confirm the tax treatment of their particular products or services before making sales.
Tennessee has a special sales tax rate for qualifying food and food ingredients. While the general state sales tax rate is 7%, qualifying food is generally subject to a reduced 4% state sales tax rate, plus applicable local tax.
Not all food purchases qualify for the reduced rate. Prepared food, dietary supplements, alcoholic beverages, and certain other products may be taxed differently. Businesses selling groceries, prepared meals, or similar products should ensure items are categorized correctly.
How to Register for Tennessee Sales Tax
Businesses required to collect Tennessee sales tax can register through the Tennessee Taxpayer Access Point (TNTAP).
The basic process includes:
- Complete the online business tax registration.
- Provide your EIN and business information.
- Register for a Tennessee Sales and Use Tax account.
- Receive confirmation of your registration.
- Begin collecting sales tax when required.
Businesses should complete registration before beginning to collect Tennessee sales tax.
Tennessee Sales Tax Rates
Tennessee’s general state-wide Sales and Use Tax rate is 7%. Local jurisdictions also impose sales taxes, with the local rate generally capped at 2.75%. As a result, the combined sales tax rate depends on the location of the transaction.
Businesses selling throughout Tennessee should ensure their ecommerce or point-of-sale systems apply the correct local rate.
Tennessee’s Single Article Tax
Tennessee has an unusual rule for expensive individual items known as the single article tax.
The standard local sales tax generally applies only to the first $1,600 of the sales price of a single article. An additional 2.75% state tax then applies to the portion of the item’s price between $1,600 and $3,200.
This rule can affect businesses selling higher-value products such as:
- Furniture
- Appliances
- Electronics
- Equipment
- Certain other expensive goods
Because this calculation differs from Tennessee’s normal sales tax rules, businesses selling high-value products should ensure their tax software is configured correctly.
Marketplace Facilitator Rules
Marketplace facilitators such as Amazon, Etsy, eBay and Walmart Marketplace generally collect and remit Tennessee sales tax on marketplace sales. If you also sell through your own website or directly to customers, you’re responsible for collecting tax on those sales if you have nexus.
Filing Requirements
Collecting sales tax is only part of your responsibility. You must also file sales tax returns and remit the tax you’ve collected to TNTAP.
Your filing frequency is assigned when you register and is based on your expected sales tax liability and will either be:
- Monthly
- Quarterly
- Annually
Businesses that fail to file returns or remit Tennessee sales tax on time may face late filing penalties, interest on unpaid tax and collection actions.
Tennessee Sales Tax Holiday
Tennessee holds an annual sales tax holiday for qualifying back-to-school purchases. During the holiday, qualifying items can be purchased without state or local sales tax.
For the 2026 holiday, qualifying purchases included:
- Clothing priced at $100 or less per item
- School supplies priced at $100 or less per item
- Computers priced at $1,500 or less
Qualifying online purchases are also eligible.
Businesses selling these products should review the Tennessee Department of Revenue’s guidance each year because eligibility rules and dates should be confirmed before the holiday begins.
Tennessee Sales Tax Compliance Checklist
- Determine whether you have physical or economic nexus.
- Register through TNTAP when required.
- Determine which products and services are taxable.
- Collect the correct state and local tax rates.
- Apply special rules for qualifying food and single articles.
- File all required returns on time.
FAQs
What is the sales tax rate in Tennessee?
Tennessee has a 7% state sales tax, plus local taxes of up to 2.75%.
What is Tennessee’s economic nexus threshold?
Remote sellers generally establish nexus with more than $100,000 in Tennessee sales during the previous 12 months.
Does Tennessee have a transaction threshold?
No, Tennessee does not use a transaction-count threshold for economic nexus.
Is food taxable in Tennessee?
Yes, but qualifying food generally receives a reduced 4% state sales tax rate, plus applicable local tax.
Does Tennessee have a sales tax holiday?
Yes, Tennessee holds an annual sales tax holiday for qualifying clothing, school supplies, and computers.
Final Thoughts
Tennessee’s sales tax system combines a 7% statewide rate with local taxes of up to 2.75%, so businesses need to ensure they’re applying the correct rate to each transaction. Businesses should also pay particular attention to Tennessee’s $100,000 economic nexus threshold, reduced tax rate for qualifying food, and single article tax rules. Registering when required, collecting the correct tax, and filing returns on time will help keep your business compliant.
Need help with Tennessee sales tax registration, filings, or compliance? Contact our tax professionals today.
