Tennessee Code Title 67. Taxes and Licenses § 67-3-505

(a) The terminal operator of a terminal in this state is jointly and severally liable for the taxes and fees imposed under §§ 67-3-202 -- 67-3-204, and shall remit payment to the department upon discovery of either of the following conditions:

(b) The terminal operator is jointly and severally liable for the taxes and fees imposed under §§ 67-3-202 -- 67-3-204 that are not allocable to any licensed supplier, and shall remit the taxes and fees due with the annual report required under § 67-3-702(d); provided, that no taxes and fees shall be due if the terminal operator can establish by evidence acceptable to the commissioner that the gallons lost were diesel fuel dyed prior to receipt by that terminal operator. No collection allowance or deductions shall be allowed with respect to payment of these taxes. In the event the gallons lost or unaccounted for exceed five percent (5%) of the gallons removed from that terminal across the rack, a penalty of one hundred percent (100%) of the taxes and fees otherwise due shall be paid by the terminal operator with the taxes and fees due.