Knowledgebase-City's Share of the State Beer Tax


Information Product

Title:City's Share of the State Beer Tax
Summary:MTAS was asked whether a city can prohibit the sale of beer and if that
decision would jeopardize the city's share of the state beer tax.
Original Author:Hemsley, Sid
Co-Author:
Product Create Date:08/15/97
Last Reviewed on::06/19/2017
Subject:Alcoholic beverages; Alcoholic beverages--Laws and regulations; Beer; Beer--Laws and regulations; Taxes--Beer; Taxes--State shared
Type:Legal Opinion
Legal Opinion:

Reference Documents:

Text of Document: August 15, 1997

You have the following questions:

1. Can the city legally prohibit the sale of beer? Yes.

2. If the city does not permit the sale of beer, does that decision jeopardize the city's share of the state beer tax? No.

Question 1

Tennessee municipalities clearly have the authority to permit, or to entirely prohibit, the sale of beer. However, the prohibition or the permission, whichever the case may be, should be expressed by ordinance. In the latter case the ordinance should regulate the conditions under which beer can be sold. Municipalities have considerable authority to regulate the time, place and manner of the sale of beer. I will be glad to provide you more information in that area if you choose. However, as I understand it, the city wants to entirely prohibit the sale of beer. I have drafted a simple ordinance that accomplishes that goal.

Question 2

All cities in Tennessee under Tennessee Code Annotated, section 57-5-205, receive a share, on a per capita basis, of the per barrel tax on the manufacture, transportation and sale of beer. Whether or not any particular municipality allows or permits the sale of beer has nothing whatever to do with its share of the per barrel tax under that statute.

Let me know if I can help you further in this or any other matter.



Sincerely,



Sidney D. Hemsley
Senior Law Consultant

SDH/

Please remember that these legal opinions were written based on the facts of a given city at a certain time. The laws referenced in any opinion may have changed or may not be applicable to your city or circumstances.

Always consult with your city attorney or an MTAS consultant before taking any action based on information contained in this database.