State Senator Brian Kelsey (R-Germantown) filed a constitutional amendment Wednesday to permanently ban an income tax in Tennessee.  The “No State Income Tax Amendment,” or Senate Joint Resolution 1, would allow Tennesseans to vote in 2014 to clarify the state constitutional prohibition on a personal income tax. 

“Tennessee voters overwhelmingly elected state legislators Tuesday who oppose an income tax,” said Senator Kelsey.

  “In these difficult economic times, the last thing Tennesseans need to be worrying about is having to pay a state income tax. This amendment will put the issue to rest once and for all.”

Senator Kelsey announced Wednesday that he has also filed a separate state constitutional amendment that would change the way state appellate judges are chosen to mirror the Founding Fathers plan in the U.S. Constitution.  Senate Joint Resolution 2, called the Founding Fathers Plan Plus, calls for appointment of state appellate judges in a manner similar to the federal model by allowing the Tennessee governor to appoint judges subject to confirmation by the General Assembly. That amendment passed the House and Senate by two-thirds majorities last year.   

The “No State Income Tax” Amendment also begins step two of a three-step process of amending the state constitution.  Step one occurred when the resolution passed the Senate and the House with bipartisan support of over two-thirds of the members during the 2011-2012 General Assembly.  Step two will require a two-thirds vote of the Senate and House during the 2013-2014 General Assembly, which will convene January 8.  Step three is a ratification vote by the people on the November 2014 ballot.

State Representative Glen Casada (R-Franklin) is the House sponsor of the amendment: “I am optimistic that we will be able to move forward this year with the two-thirds majority needed to put this matter into the people’s hands,” he said.

The resolution specifies that the legislature as well as Tennessee counties and cities shall be prohibited from passing either an income tax or a payroll tax, which is a tax on employers that is measured by the wages they pay their workers.  The Hall income tax on dividends and interest will remain unchanged by the amendment.

Although many legal scholars argue that the state constitution already forbids an income tax, the state attorney general opined in 1999 that an income tax would be legal.  The opinion prompted elected officials to propose an income tax that failed by only five votes in the House of Representatives in 2002.  In recent years lawmakers have continued to propose bills to enact both an income tax and a payroll tax.