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HB0627 • 2026

Taxes, Hotel Motel

AN ACT to amend Tennessee Code Annotated, Title 7 and Title 67, relative to occupancy tax.

Taxes
Enacted

This bill passed the Legislature and reached final enactment based on the latest official action.

Sponsor
Crawford, Briggs
Last action
2025-05-13
Official status
Comp. became Pub. Ch. 372
Effective date
Not listed

Plain English Breakdown

The summary text provided does not include specific details about penalties or consequences for non-compliance, which may be inferred but cannot be confirmed from the given information.

Hotel and Motel Occupancy Tax Changes

This bill changes how hotel and motel occupancy tax revenue is used in Tennessee to focus on tourism promotion and development.

What This Bill Does

  • Changes the way cities can use money from hotel and motel taxes. They must now spend it on things that help tourism, like advertising or building new attractions for visitors.
  • Requires cities to report every year how they spent their tourism tax money and what they did with it.
  • If a city uses its tourism tax money in the wrong way, it has to pay back the money using other funds and use it correctly next time.
  • Defines 'tourism development' as creating or expanding places that attract visitors, like parks or museums.

Who It Names or Affects

  • Cities and towns in Tennessee that collect hotel and motel taxes
  • Hotels and motels in those cities and towns

Terms To Know

Tourism Development
The creation or expansion of physical attractions, facilities, or events available to the public, improving destinations' appeal to tourists.

Limits and Unknowns

  • It is unclear how this will affect short-term rental units and their taxes.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

Amendment 1-0 to HB0627

Plain English: The amendment changes how hotel occupancy taxes are used by cities to support tourism promotion and development.

  • Defines 'tourism promotion' as activities aimed at attracting tourists and boosting economic activity through tourism.
  • Specifies that a tourist is someone who travels more than 50 miles for business or leisure.
  • Requires municipalities to use hotel occupancy tax revenue specifically for tourism promotion and development, with penalties if funds are misused.
  • The amendment text does not specify all details about how the new definitions will be implemented in practice.
Amendment 1-0 to SB0629

Plain English: The amendment changes how Tennessee defines tourism-related terms and requires municipalities to use hotel occupancy tax revenue for specific tourism purposes.

  • Defines 'tourism promotion' as activities aimed at attracting tourists and boosting economic activity through tourism.
  • Establishes a new definition for 'tourist' as someone who travels more than 50 miles for business or leisure.
  • Requires municipalities to use hotel occupancy tax revenue specifically for tourism promotion and development, with penalties if funds are misused.
  • The amendment text does not specify all details about how the new definitions will be implemented or enforced.

Bill History

  1. 2025-05-13 Tennessee General Assembly

    Comp. became Pub. Ch. 372

  2. 2025-05-13 Tennessee General Assembly

    Effective date(s) 05/05/2025

  3. 2025-05-13 Tennessee General Assembly

    Pub. Ch. 372

  4. 2025-05-05 Tennessee General Assembly

    Signed by Governor.

  5. 2025-04-23 Tennessee General Assembly

    Transmitted to Governor for action.

  6. 2025-04-22 Tennessee General Assembly

    Signed by H. Speaker

  7. 2025-04-22 Tennessee General Assembly

    Signed by Senate Speaker

  8. 2025-04-22 Tennessee General Assembly

    Enrolled and ready for signatures

  9. 2025-04-16 Tennessee General Assembly

    Comp. SB subst.

  10. 2025-04-16 Tennessee General Assembly

    Passed H., Ayes 82, Nays 2, PNV 7

  11. 2025-04-16 Tennessee General Assembly

    Am. withdrawn. (Amendment 1 - HA0390)

  12. 2025-04-16 Tennessee General Assembly

    Subst. for comp. HB.

  13. 2025-04-15 Tennessee General Assembly

    H. Placed on Regular Calendar for 4/16/2025

  14. 2025-04-15 Tennessee General Assembly

    Placed on cal. Calendar & Rules Committee for 4/15/2025

  15. 2025-04-15 Tennessee General Assembly

    Rec. for pass; ref to Calendar & Rules Committee

  16. 2025-04-14 Tennessee General Assembly

    Placed on cal. Finance, Ways, and Means Committee for 4/15/2025

  17. 2025-04-14 Tennessee General Assembly

    Rec. for pass by s/c ref. to Finance, Ways, and Means Committee

  18. 2025-04-14 Tennessee General Assembly

    Rcvd. from S., held on H. desk.

  19. 2025-04-10 Tennessee General Assembly

    Placed on s/c cal Finance, Ways, and Means Subcommittee for 4/14/2025

  20. 2025-04-10 Tennessee General Assembly

    Sponsor(s) Added.

  21. 2025-04-10 Tennessee General Assembly

    Engrossed; ready for transmission to House

  22. 2025-04-10 Tennessee General Assembly

    Passed Senate as amended, Ayes 30, Nays 0, PNV 2

  23. 2025-04-10 Tennessee General Assembly

    Senate adopted Amendment (Amendment 1 - SA0298)

  24. 2025-04-09 Tennessee General Assembly

    Assigned to s/c Finance, Ways, and Means Subcommittee

  25. 2025-04-09 Tennessee General Assembly

    Rec. for pass. if am., ref. to Finance, Ways, and Means Committee

  26. 2025-04-08 Tennessee General Assembly

    Placed on Senate Regular Calendar for 4/10/2025

  27. 2025-04-07 Tennessee General Assembly

    Refer to Senate Calendar Committee

  28. 2025-04-07 Tennessee General Assembly

    Recalled from Senate Finance, Ways & Means Committee

  29. 2025-04-02 Tennessee General Assembly

    Placed on cal. State & Local Government Committee for 4/9/2025

  30. 2025-04-02 Tennessee General Assembly

    Action def. in State & Local Government Committee to 4/9/2025

  31. 2025-04-01 Tennessee General Assembly

    Recommended for passage with amendment/s, refer to Senate Finance, Ways, and Means Committee Ayes 7, Nays 0 PNV 0

  32. 2025-03-26 Tennessee General Assembly

    Placed on cal. State & Local Government Committee for 4/2/2025

  33. 2025-03-26 Tennessee General Assembly

    Action def. in State & Local Government Committee to 4/2/2025

  34. 2025-03-26 Tennessee General Assembly

    Placed on Senate State and Local Government Committee calendar for 4/1/2025

  35. 2025-03-25 Tennessee General Assembly

    Action deferred in Senate State and Local Government Committee to 4/1/2025

  36. 2025-03-19 Tennessee General Assembly

    Placed on cal. State & Local Government Committee for 3/26/2025

  37. 2025-03-19 Tennessee General Assembly

    Action def. in State & Local Government Committee to 3/26/2025

  38. 2025-03-19 Tennessee General Assembly

    Placed on Senate State and Local Government Committee calendar for 3/25/2025

  39. 2025-03-18 Tennessee General Assembly

    Action deferred in Senate State and Local Government Committee to 3/25/2025

  40. 2025-03-12 Tennessee General Assembly

    Placed on cal. State & Local Government Committee for 3/19/2025

  41. 2025-03-12 Tennessee General Assembly

    Rec for pass if am by s/c ref. to State & Local Government Committee

  42. 2025-03-11 Tennessee General Assembly

    Placed on Senate State and Local Government Committee calendar for 3/18/2025

  43. 2025-03-05 Tennessee General Assembly

    Placed on s/c cal Cities & Counties Subcommittee for 3/12/2025

  44. 2025-03-05 Tennessee General Assembly

    Assigned to s/c Cities & Counties Subcommittee

  45. 2025-03-05 Tennessee General Assembly

    Ref. to State & Local Government Committee

  46. 2025-02-12 Tennessee General Assembly

    Passed on Second Consideration, refer to Senate State and Local Government Committee

  47. 2025-02-10 Tennessee General Assembly

    Introduced, Passed on First Consideration

  48. 2025-02-05 Tennessee General Assembly

    P2C, caption bill, held on desk - pending amdt.

  49. 2025-02-03 Tennessee General Assembly

    Intro., P1C.

  50. 2025-01-31 Tennessee General Assembly

    Filed for introduction

  51. 2025-01-31 Tennessee General Assembly

    Filed for introduction

Official Summary Text

ON APRIL 10, 2025, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 629, AS AMENDED.

AMENDMENT #1 rewrites the bill to, instead, make the following revisions to present law relative to the
privilege tax upon the privilege of occupancy in a hotel
levied by municipalities:



Revises provisions relative to the disposition of proceeds of such tax to, instead, provide the following:



Generally, t
he revenue received by a municipality from the tax must be designated and used for tourism promotion and tourism development, including debt service and contractual obligations incurred in furtherance of such purposes
.



Generally, tourism
development investments authorized under
law relative to such
tax must not be used to fund general government expenditures or activity unless designated and approved through a memorandum of understanding between a municipality's governing body and the designated destination marketing entity.



A
municipality levying
such
a tax before May 1, 2025, may continue to use the revenue in the manner prescribed in the private act, resolution, or ordinance levying the tax.



Not later than 90 days after the end of a municipality's fiscal year, each municipality that levies
such
tax
must
provide an annual written report to the commissioner of the department of tourist development.

The annual written report must detail the amount of revenue spent by the municipality, and its subordinate contractors, and how those expenditures have been designated and used for tourism promotion and tourism development.



If an audit by the comptroller of the treasury or by contractors employed by a municipality with the approval of the comptroller, finds that a municipality has spent funds derived from
such
tax for purposes not related to tourism promotion and tourism development, the municipality
must
, using general funds, appropriate an amount equal to the amount spent improperly to be used to support tourism promotion and tourism development for the next subsequent fiscal year.



Defines, for purposes of law relative to such tax, "tourism
development"
as
the creation or expansion of physical attractions, facilities, or events that are available and open to the public, improving the appeal of destinations to tourists, and enhancing tourist experiences that are primarily promoted to or used by tourists
.



Authorizes a
municipality
to
adopt an ordinance or resolution requiring funds received from the department of revenue that were collected from the tax levied upon the privilege of occupancy of a short-term rental unit secured through a short-term rental unit marketplace to be used for the promotion of tourism and tourism development.



Limits the present law provision prohibiting such
tax
from
exceed
ing
4% of the consideration charged to a transient by the hotel operator
by
provid
ing
that, on or after the effective date of
the bill
, a municipality
must
not increase
such
tax in an amount such that the cumulative tax in an incorporated area of a county exceeds 8%.

Current Bill Text

Read the full stored bill text 
SENATE BILL 629
By Briggs

HOUSE BILL 627
By Crawford

HB0627
002483
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 7 and
Title 67, relative to occupancy tax.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 7-4-107, is amended by deleting the
language "three (3) years" and substituting instead "four (4) years".
SECTION 2. This act takes effect upon becoming a law, the public welfare requiring it.