Tennessee law provides for certain military service-based tax exemptions for motor vehicle sales.
To view the requirements associated with the exemptions, please see Tenn. Code Ann § 67-6-303(a)(1), found here. One of the primary requirements to purchase a motor vehicle tax exempt is that the military member must be stationed in Tennessee or at a military reservation located partially within Tennessee.
New or used vehicles sold, given, or donated to a disabled veteran or active-duty service member who receives a U.S. Department of Veterans Affairs (VA) automobile grant, are exempt from sales tax for the portion of the vehicle price in excess of the VA grant. This exemption also includes the motor vehicle privilege tax and registration fee.
Reference: Tenn. Code Ann. § 67-6-303(a)(1).