Sales of prepaid calling cards and authorization codes are subject to sales tax at the time of the sale of the card or code. No additional tax is due when the purchaser accesses the telecommunication service. A dealer of prepaid calling cards and authorization codes can purchase the telecommunication services associated with the cards and codes without paying sales tax on the purchase by using a resale certificate.
Reference: Important Notice 17-18. Tenn. Code Ann. §§ 67-6-230(a), 67-6-102, and 67-6-202.