Proposal includes four tax increases.
Not long after the IMPROVE Act was passed, some Tennesseans will be weighing in on another transit funding plan.
If voters approve Nashville Mayor Megan Barry’s new transit funding plan for the city, Nashville could soon be tied with Chicago for the nation’s highest combined sales tax rate. The city would also have the nation’s sixth highest tax rate on hotel stays.
The $5.2 billion plan would build a high-capacity transit system, including 26 miles of light rail on four major corridors, 25 miles of bus rapid transit, service improvements to city buses, and a 1.8-mile downtown connection tunnel for transit lines. To fund it, Barry has proposed four tax increases: the sales tax, hotel/motel tax, local rental car tax, and business and excise tax.
If passed, the sales tax would rise to 9.75 percent in 2018 and 10.25 percent in 2023. It’s currently 9.25 percent (7 percent state sales tax and 2.25 percent local sales tax for Metro). The hotel/motel tax is currently 6 percent, and Barr has proposed a 0.25 percent increase in 2018, with an adjustment to a 0.375 percent increase in 2023.
