Tenn. Code Ann. § 4-39-103: Vendor contract with subcontractor to include provision for payment of sales and use taxes by subcontractor

If any portion of the cost of a vendor's major procurement contract with a state governmental entity is subcontracted, the vendor shall include in the contract with the subcontractor a provision that the subcontractor shall remit sales and use taxes on taxable sales of goods or services made by the subcontractor.