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Vanderbilt Law Review

Authors

Stanely D. Rose

First Page

433

Abstract

The primary consideration in the adoption of a tax by a state is the constitutional framework into which it is to be fitted. Probable litigation is a factor of importance in the choice of a tax. If there are no complicating factors, a simple tax on sales seems to be one of the forms of excise tax most easily sustainable under the Tennessee Constitution. Indeed, Tennessee at an early date had a sales tax which apparently met with court approval.

The most inclusive authority upon which to base an excise tax in Tennessee is the clause which states that "the legislature shall have power to tax Merchants, Peddlers, and privileges, in such manner as they may from time to time direct." The extensive scope of this clause has long been established. "A privilege is whatever the Legislature choose to declare to be a privilege and to tax as such."

The first case to come before the Tennessee Supreme Court on this Act confirms the right of the state to declare selling a taxable privilege. The fact that the buying is of food to eat in order to live was held to be immaterial. There is no natural right in the form of a business transaction that is inherently exempt from taxation, if the Legislature declares it to be a privilege.

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