Utility Gross Receipts Tax

The utility gross receipts tax of 3% of based on intrastate gross receipts. Gross receipts taxes are paid by utilities; gas, water, electric power and light companies; and sewage companies. Tennessee offers the following incentives and exemptions:

Manufacturers and distributors of manufactured or natural gas are taxed at a rate of 1.5%.

Utilities operated by the United States, cities, or political subdivisions of the state are exempt from the gross receipts tax.

Credit is allowed for corporate franchise and excise taxes paid. Water and electric companies may deduct $5,000 annually from gross receipts.

The gross receipts tax is due August 1 each year but may be paid in installments.