The Nashville sales tax rate is 9.75% on most retail purchases, combining Tennessee’s 7% state tax with Davidson County’s 2.75% local tax.1Tennessee Department of Revenue. Change of Local Tax Rate – Davidson County The local portion rose from 2.25% to 2.75% on February 1, 2025, after voters approved a half-percent transit surcharge. Groceries get a lower combined rate of 6.75%, and several categories of goods and services are exempt entirely.
What the 9.75% Covers
Tennessee charges 7% state sales tax on tangible personal property and most taxable services.2Tennessee Department of Revenue. Tennessee Sales and Use Tax Due Dates and Tax Rates Davidson County adds the maximum local rate state law allows, 2.75%, which brings the total on routine purchases in Nashville to 9.75%.1Tennessee Department of Revenue. Change of Local Tax Rate – Davidson County Electronics, clothing, furniture, household goods, and almost everything else you ring up at a register fall here. Retailers collect the whole amount and send it to the Tennessee Department of Revenue.
Groceries and Prepared Food
Unprepared groceries are taxed at a reduced state rate of 4% rather than 7%, while the 2.75% local rate still applies in full.2Tennessee Department of Revenue. Tennessee Sales and Use Tax Due Dates and Tax Rates That makes the combined grocery rate in Nashville 6.75%. Raw meat, fresh produce, milk, bread, and similar staples bought for home consumption qualify.
Prepared food does not. Anything a seller has heated, mixed, or assembled is taxed at the full 9.75%. A rotisserie chicken from the deli counter is prepared; a raw whole chicken from the meat case is not. Brewed coffee is prepared; coffee beans are not. A deli sandwich is prepared; a loaf of bread is not. Candy, dietary supplements, soft drinks, and tobacco also stay at the full 9.75%.3Tennessee Department of Revenue. SUT-13 – Sales and Use Tax Rates – Overview
Big-Ticket Items and the Single Article Cap
Nashville’s 2.75% local tax only applies to the first $1,600 of any single item’s price.4Tennessee Department of Revenue. Single Article and Special Tax Rates Above $1,600, the local portion drops off and a separate state single article tax of 2.75% kicks in on the slice of the price between $1,600 and $3,200. Above $3,200, only the 7% state rate applies.
On a $5,000 piece of furniture, that works out like this:
- First $1,600: 7% state plus 2.75% local, or $156.00
- $1,600 to $3,200: 7% state plus 2.75% state single article tax, or $156.00
- $3,200 to $5,000: 7% state only, or $126.00
- Total: $438.00, an effective rate of 8.76%
A single article means one independent unit, not a receipt total.4Tennessee Department of Revenue. Single Article and Special Tax Rates Five items at $1,000 each on the same invoice are five separate articles, each fully under the cap. The rule matters most on cars, appliances, and jewelry.
Where You’ll Pay More Than 9.75%
A few things carry taxes stacked on top of the standard rate.
Drinks at Bars and Restaurants
Alcoholic beverages sold for on-premises consumption carry a 15% state tax in addition to regular sales tax.5Justia. Tennessee Code 57-4-301 – Privilege Taxes – Tax on Retail Sales Every cocktail, beer, and glass of wine served at a Nashville bar or restaurant falls under it. The establishment can either build the 15% into menu prices or add it as a separate line on your check.
Hotel Stays
Visitors staying in Nashville hotels and short-term rentals pay a local hotel occupancy privilege tax on top of state and local sales tax. Davidson County increased this tax by 1% through an ordinance adopted in December 2022.6Metropolitan Government of Nashville and Davidson County. Increase of Hotel Occupancy Tax The revenue funds tourism infrastructure including convention and sports venues.
Rental Cars
Short-term vehicle rentals carry a 3% surcharge on the gross rental price, collected in addition to standard sales tax.7Tennessee Department of Revenue. Automobile Rental Surcharge Tax – Due Date and Tax Rates
What’s Exempt
Prescription Drugs and Medical Equipment
Any drug dispensed with a prescription is exempt, including over-the-counter medications when a doctor writes a prescription for them. Insulin and medical oxygen dispensed by prescription are exempt without exception.8Justia. Tennessee Code 67-6-320 – Prescription Drugs A separate statute exempts prosthetic devices, durable medical equipment for home use sold by prescription, oxygen delivery equipment, kidney dialysis equipment, insulin syringes, and diabetic testing supplies.9Justia. Tennessee Code 67-6-314 – Medical Equipment and Devices Grooming and hygiene products bought at a pharmacy are not exempt.
Most Professional Services
Tennessee generally does not tax services unless a specific statute makes them taxable. Fees charged by attorneys, accountants, doctors, and similar professionals are not subject to sales tax, and the same goes for most labor-only work where no physical product changes hands. Taxable exceptions include repair of tangible property, installation services, parking, telecommunications, lodging, and admissions to entertainment or recreational events.
Nonprofits with the Right Paperwork
Qualified nonprofits can buy tax-free, but they must first apply for and receive a Sales and Use Tax Certificate of Exemption from the Department of Revenue and present a copy to the retailer at purchase.10Tennessee Department of Revenue. SUT-77 – Nonprofit Exemption – Overview Federal 501(c)(3) status alone does not do it; the Tennessee certificate is required.
Online Purchases
Out-of-state retailers that make $100,000 or more in sales to Tennessee customers over any 12-month period must collect and remit Tennessee sales tax, including Nashville’s local portion.11Tennessee Department of Revenue. Out-of-State Dealers and Marketplace Facilitators Most large online retailers already charge the correct 9.75% on orders shipped to Nashville.
Marketplace platforms like Amazon, eBay, and Etsy carry their own obligation. If the platform itself facilitates more than $100,000 in Tennessee sales over 12 months, the platform collects the tax and the individual third-party sellers on it do not need to register separately.11Tennessee Department of Revenue. Out-of-State Dealers and Marketplace Facilitators If you buy from a small out-of-state seller that doesn’t collect Tennessee tax and isn’t on a major marketplace, you technically owe consumer use tax at the same rates and can file it through TNTAP.12Tennessee Department of Revenue. Sales and Use Tax
The Annual Sales Tax Holiday
Tennessee holds a back-to-school sales tax holiday on the last weekend of July each year. In 2026, it runs from 12:01 a.m. on Friday, July 31 through 11:59 p.m. on Sunday, August 2. Both the 7% state tax and Nashville’s 2.75% local tax are suspended on qualifying items during that window.
- Clothing and footwear priced at $100 or less per item, covering shirts, pants, shoes, coats, hats, and similar apparel. Accessories, protective equipment, and sports gear do not qualify.13Tennessee Department of Revenue. STH-8 – Types of Clothing Items that Qualify for Sales Tax Holiday Exemption
- School supplies priced at $100 or less per item.
- Computers and tablets priced at $1,500 or less per unit, for personal use.
The thresholds are per item, not per transaction. A $90 pair of shoes qualifies; a $110 pair does not, no matter what else is in the cart. Items sold as a bundle cannot be split to get under the limit. At 9.75%, a family spending $300 on qualifying back-to-school purchases saves roughly $29.