Chattanooga to lose roughly $5 million annually after state lawmakers repeal Hall Income Tax

FILE - In this March 8, 2016, file photo, House Majority Leader Gerald McCormick, R-Chattanooga, speaks during a House Finance Committee hearing in Nashville, Tenn. McCormick on Tuesday, April 19, vowed retribution for companies that spoke out against a transgender bathroom bill, suggesting that lawmakers should consider limiting tax incentives and grants to them. (AP Photo/Erik Schelzig, File)

NASHVILLE - Tennessee lawmakers on Friday wrapped up their annual session by passing landmark legislation that begins phasing out and eventually repeals a 1920s-era tax on investment income that generates hundreds of millions of dollars for state and local governments.

After months of wrangling, senators and representatives agreed to cut the 6 percent Hall Income Tax on stock dividends and interest earnings by 1 percent to 5 percent for the 2016 tax year.