Incentives for growth

If there is one thing we've learned over the years, we’re in business because you’re in business.

Long-term growth meets increased profitability with competitive grants for workforce training, public infrastructure and economic development. Our commitment doesn't stop there. We offer incentives to help make your decision an easy one.
# Grants

We want to put your company on the road to success and provide momentum for future growth. Our state’s signature “FastTrack” program includes grants for infrastructure development, job training, and a discretionary fund for a variety of other expenses.

FastTrack Infrastructure Program

  • Grants made to local communities for public infrastructure improvements
  • Must be for specific infrastructure projects benefitting one or more companies committed to creating new jobs and/or making new capital investments
  • Cover infrastructure such as rail, road, port, airport, site, water, sewer, gas and telecommunication improvements
  • Require local matching funds based on a community’s ability to pay

FastTrack Job Training Assistance Program

  • Reimbursable grant assisting companies with training expenses and the development of customized training plans
  • Two reimbursement methods:
    • Traditional – reimbursement for classroom instruction, certain travel expenses, system support applications, instructor for on-the-job training, and specific vendor training
    • Job Based Training – offers the company reimbursement of training funds determined from project-specific payroll records 

FastTrack Economic Development Fund

  • Provides additional grant support for companies expanding or locating in Tennessee with reimbursable grants made to local industrial development boards
  • Aids companies in a variety of ways, including relocation expenses, temporary office space, capital improvements, retrofitting and other expenditures not previously covered by FastTrack infrastructure or job training grants
  • Only used in exceptional cases where the impact of the company on a given community is significant.

FastTrack eligibility and funding levels are determined by:

  • Amount of company investment
  • Number of new hires
  • Wages of new hires
  • Types of skills and knowledge that must be obtained
  • Location of the project
# Tax Credits

Competitive tax incentives make Tennessee a smart choice for doing business. We have one of the country’s lowest per capita tax burdens, no income tax on wages, and no state property tax.

Tax credits include those based on the number of jobs created, amount invested, type of business and location. We also have credits for qualified industrial machinery purchases and a series of sales and use tax exemptions.

Job Tax Credit

Credit of $4,500 per job to offset up to 50% of franchise and excise (F&E) taxes in any given year with a carry forward for up to 15 years.

Create at least 25 net new full-time positions within a 36 month period and invest at least $500,000 in a qualified business enterprise.


Community Resurgence: Credit of $2,500 per each position.

Create 10 net new full-time jobs each paying the state’s average occupational wage and also be located in a census tract where poverty rate exceeds 30%. 

Enhanced Job Tax Credit

Allows an additional annual credit for locations/expansions in designated Tier 2, Tier 3, and Tier 4 Enhancement Counties. Enhanced JTC can offset up to 100% of F&E liability.



Tier 2: 3 year annual credit at $4,500 per job with no carry forward.

Create at least 25 net new full-time positions within a 36 month period and invest at least $500,000 in a qualified business enterprise.

Tier 3: 5 year annual credit at $4,500 per job with no carry forward.

Create at least 20 net new full-time positions within 60 month period and invest at least $500,000 in a qualified business enterprise

Tier 4: 5 year annual credit at $4,500 per job with no carry forward.

Create at least 10 net new full-time positions within 60 month period and invest at least $500,000 in a qualified business enterprise. 
Industrial Machinery Tax Credit

Credit of 1% to 10% for the purchase, third party installation and repair of qualified industrial machinery.

Manufacturing: includes purchases for machinery; apparatus and equipment with parts; appurtenances and accessories; repair parts and labor.



Warehousing and distribution: includes material handling equipment and racking systems with a minimum $10M capital investment within 36 months.


Headquarters, call centers: includes computer; network; software or peripheral computer devices, purchased in making required capital investment for job tax credit.

Sales and Use Tax Exemptions

Manufacturing: sales tax exemption for industrial machinery and reduced sales tax rate for utilities at qualified manufacturing facilities.

Exemptions include industrial machinery, repair parts and industrial supplies used in the manufacturing process. Reductions include: 0-1.5% tax on water depending on use and 0-1.5% on gas, electricity and various energy sources depending on use.


Headquarters: State sales tax credit for qualified personal property purchased for a qualified headquarters facility.

Investment period begins 1 yr. prior to construction/ expansion and ends 1 yr. after construction/ expansion has concluded, but can be extended to 6 yrs. with permission from the state. HQs receive a non-expiring sales tax credit for 6.5% for qualified personal property directly related to the new full-time job creation.


Warehouse/Distribution: Sales tax exemption for material handling and racking systems purchased for a qualified warehouse or distribution center.

Investment of $10M or more, including the purchase of new equipment, made during a 3 year period.


Call Centers: Tax exemption on any sales of interstate telecommunication and international telecommunication services sold to a business for use in the operation of one or more qualified call centers.

Must have at least 250 jobs engaged primarily in call center activities.


Data Centers: Sales tax exemption for certain hardware and software purchased for a qualified data center.

Minimum capital investment of $100M and 15 new full-time positions paying at least 150% of the state’s avg. occupational wage; investment must be made during a 3 yr. period, but can be extended to 5 yrs. for investments under $1B or 7 yrs. for investments exceeding $1B with the state’s permission.


Research and Development: Sales tax exemption on certain equipment used in research and development.

Equipment must be used necessary to and primarily for research and development purposes.


View Tennessee Tax Rates