Knox County, TN Hotels & Lodging: Transient Occupancy Tax (2026)
Key Facts
- Maximum rate (tourist facility undertaken)
- 5% of room charge
- Maximum rate (no tourist facility)
- 3% of room charge
- Remittance deadline
- 20th of following month
- Operator collection allowance
- 2% of tax remitted
- Occupancy threshold
- stays under 30 continuous days
- Delinquency interest
- 8%/year plus 1%/month penalty
- Collecting official
- Knox County Clerk
Summary
Knox County levies a privilege tax on hotel stays under 30 days, capped at 5 percent of the room charge if the county has undertaken a tourist facility, or 3 percent otherwise. The county commission sets the exact rate annually in tenth-of-a-percent increments, and operators collect and remit it monthly to the county clerk.
there is authorized a privilege tax upon the privilege of occupancy in any hotel by a transient in an amount not to exceed the rates provided hereinafter of the consideration charged by the operator. The rate of the tax in increments of one-tenth of one percent shall be set annually by the county legislative body. The tax is a privilege upon the transient occupying the room or ground space and shall be collected, distributed and expended as hereinafter provided. The maximum rate of such tax shall be determined as follows: (1)If the county shall have undertaken, or shall have contracted for, construction or acquisition of a tourist related facility within the definition of this article, it is authorized to levy the tax upon the privilege of occupancy at a rate not to exceed five percent of the consideration charged by the operator.(2)If the county has not undertaken, or has not contracted to undertake, construction or acquisition of a tourist related facility within the definition of this article, it is authorized to levy the tax upon the privilege of occupancy at a rate not to exceed three percent of the consideration charged by the operator.
Official source re-checked September 7, 2026: no newer edition of the code had been published (publisher’s edition: Code of Ordinances: Supplement 23).
Full Breakdown
Article III of Chapter 58 defines a taxable "hotel" broadly: any hotel, inn, tourist court, tourist cabin, motel, or any place furnishing rooms, lodging or accommodations to transients for consideration, plus any ground space rented to transients for parking recreational vehicles, campers or tents (Sec. 58-81). "Occupancy" means use of a room or ground space for less than 30 continuous days, so short-term rentals that fit the hotel definition and rent for under 30 days fall within the tax's reach. Section 58-82 authorizes the privilege tax on occupancy, with the county legislative body setting the actual rate annually in one-tenth-of-one-percent increments up to the applicable cap.
Every operator must add the tax to each room invoice (Sec. 58-83) and remit collections to the county clerk by the 20th of the following month, keeping a 2 percent collection allowance if payment is timely (Sec. 58-84). Operators may not advertise that they will absorb or refund the tax (Sec. 58-85). Proceeds are split under Sec. 58-89: where the rate does not exceed 3 percent, two-thirds goes to tourism promotion held by the county trustee and one-third is divided evenly between the county and municipal general funds; amounts collected above 3 percent up to 5 percent are earmarked for tourist-facility bond retirement or lease obligations. Records must be kept for three years and are subject to inspection by the tax collection official (Sec. 58-87).
Violations & Fines
Willful refusal by an operator to collect or remit the tax is a misdemeanor under Sec. 58-86, with each individual occupancy charged as a separate offense. Delinquent taxes draw interest at 8 percent per year plus a penalty of 1 percent for each month or partial month the payment is late, and both interest and penalty become part of the tax owed.
Frequently Asked Questions
Does the Knox County hotel tax apply to short-term rentals like Airbnbs?
What is the current hotel tax rate in Knox County?
When must an operator remit the collected tax?
What happens if a hotel operator refuses to collect the tax?
Sources & Official References
Other rules in Knox County
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