Tennessee bill would decrease state bonanza on business taxes caused by 2017 federal tax overhaul

Tennessee Gov. Bill Haslam gives his annual State of the State address to a joint convention of the Tennessee General Assembly, Monday, Jan. 29, 2018, in Nashville, Tenn. (AP Photo/Mark Zaleski)

NASHVILLE - A bill that largely spares Tennessee corporations from an increase in state taxes otherwise triggered by President Donald Trump's 2017 federal tax overhaul is on its way to Gov. Bill Haslam for his consideration.

According to a legislative fiscal note, it would amount to $112 million in foregone state corporate excise tax revenue annually beginning in fiscal year 2020-2021.

The legislation is among dozens of bills passed in the waning hours of the 110th General Assembly before state lawmakers wrapped up their work late Wednesday night.

Sponsored by Rep. Gerald McCormick, R-Chattanooga, the bill would "decouple" Tennessee taxes from new federal tax provisions regarding net interest deductions. The Tennessee Chamber of Commerce and other business groups sought the decoupling.

The Tennessee Journal recently quoted Lee Grubbs, HCA Healthcare's chief tax officer, warning that without decoupling it would result in "one of the largest tax increases that we've had in the history of the state on businesses."