Solar tax issues facing new debate in Tennesse

A fight is heating up in the Tennessee Legislature that has green energy companies decrying what they consider a major tax increase as Republicans look to eliminate an incentive for solar and other renewable power.
Senate Bill 3296/House Bill 3520 would get rid of a provision allowing for solar and other green energy installations to have their taxation based on a small percentage of their salvage value. The provision — pushed originally by the administration of former Gov. Phil Bredesen — means there’s nearly no taxation, part of an effort to subsidize renewable energy in Tennessee.

Republicans pushing to eliminate the tax arrangement dispute the idea that it will amount to a new tax. Sen. Randy McNally, who chairs the Senate Finance Ways and Means Committee and is among those pushing the legislation, said the state believes very few businesses will be affected. “I don’t think there’s a lot of people that meet that standard,” he said.
Proponents of the new legislation say taxpayers are supposed to apply for a little-used state green certification. With little use, McNally said, the legislation amounts to a closure of a tax loophole that makes the system more fair to industry overall.