NAIFA has joined a coalition of professional associations urging Tennessee policymakers to phase out and ultimately repeal the state’s Professional Privilege Tax (PPT). In a joint letter sent to Governor Bill Lee, the coalition called on state leaders to prioritize a phase-out of this outdated tax in the FY 2026–2027 budget, emphasizing that Tennessee should not fund government through a tax on the “privilege” of working. The PPT currently imposes a $400 annual tax on certain licensed professionals, including financial advisors, despite their significant contributions to the state’s economy .
Financial professionals play a vital role in helping Tennesseans save, invest, and plan for retirement and life’s major milestones. The coalition letter underscores that the financial service industry employs more than 125,000 Tennesseans and accounts for a meaningful share of the state’s workforce, yet remains subject to a tax that no longer reflects today’s economic realities. As demand for personalized financial advice grows, the PPT ultimately raises costs for consumers and limits access to professional guidance, putting Tennessee at a disadvantage compared to neighboring states that have moved away from similar taxes .
The letter also highlights that Tennessee is well-positioned to act. Thanks to strong fiscal stewardship, the state enjoys a solid financial footing and a reputation as a business-friendly destination. Previous budget proposals have already acknowledged the need to reduce the PPT, recognizing that taxing work runs counter to Tennessee’s core principles. Eliminating this barrier would help attract and retain top talent at a time when financial professionals are increasingly mobile and choosing where to live and build their practices .