More senior citizens would qualify for Hall income tax relief under legislation sponsored by Senate Majority Leader Mark Norris (R-Collierville) that was approved by the Senate Finance Committee’s Tax Subcommittee on Wednesday. The bill is included in Governor Bill Haslam’s legislative package.
“This legislation allows more seniors to qualify for Hall tax relief,” said Leader Norris, who sponsored the constitutional amendment to enact property tax freezes for senior citizens by Tennessee municipalities. “It dovetails very well with our property tax relief amendment for seniors and helps those who have saved for their retirement.”
The Hall tax is imposed on income derived from interest on bonds, notes and stock dividends. Since enactment of the Hall tax in 1929, the use of investment savings has grown as a primary source of retirement income. Senate Bill 198 raises the Hall income tax exemption level for citizens age 65 and older from $26,200 to $33,000 for single filers and from $37,000 to $59,000 for those filing jointly.
“Senior citizens who are on fixed incomes are hit hardest by the Hall tax,” said Senator Norris. “The increase in the income exemption will also make the state more competitive which is good for our economy.”
The state budget legislation which Norris is sponsoring for Governor Haslam provides a total of $23.1 million which will go back to taxpayers through a combination of tax relief proposals. The tax relief measures include reducing the state portion of the sales tax on grocery food from 5.25 percent to 5.0 percent and raising the inheritance tax exemption level from $1.25 million to $2 million. The budget proposal also provides tax relief for low income seniors, veterans and the disabled by fully funding the growth of the property tax freeze program, which Norris sponsored that was enacted in 2007.