Bill > SB1367

This bill proposes significant changes to Tennessee's sales tax treatment of food and food ingredients, primarily by exempting these items from state sales and use tax. Specifically, the bill removes existing provisions that previously taxed food sales, ensuring that retail sales of food and food ingredients will no longer be subject to sales tax. To maintain local government funding, the bill requires the state to allocate to counties and municipalities an amount equivalent to what they would have received before the food tax exemption, based on reporting of exempt food sales. The bill also makes several technical amendments to related statutes, such as modifying language in sections about food sales and adjusting references to taxable sales for certain business licenses. For example, it changes requirements for businesses like grocery stores and restaurants, removing references to "taxable sales" and instead focusing on overall sales of food and food ingredients. The tax exemption is set to take effect on July 1, 2025, which will provide time for administrative preparation and implementation. This change aims to reduce the cost of groceries for Tennessee residents by eliminating sales tax on food purchases.

Budget and Finance

https://wapp.capitol.tn.gov/apps/Billinfo/default.aspx?BillNumber=SB1367&ga=114