Tennessee House Bill HB0409

Tennessee 2023-2024 Regular Session

• Introduced: 1/24/23
• Refer: 2/1/23

Caption

AN ACT to amend Tennessee Code Annotated, Section 67-6-228, relative to food and food ingredients.

Impact

The enactment of HB0409 would have a direct impact on the way food products are taxed in Tennessee, particularly benefiting consumers who purchase fresh produce. By exempting essential food items such as fruits and vegetables from sales tax, the bill could potentially influence purchasing behavior positively, encouraging residents to opt for healthier food options. Additionally, this tax reform could stimulate economic activity in grocery retail and food distribution sectors, as more individuals may be inclined to purchase higher quantities of exempted produce due to the cost savings.

Summary

House Bill 0409 seeks to amend Tennessee Code Annotated, Section 67-6-228, which pertains to the taxation of food and food ingredients. The main objective of the bill is to establish a more favorable tax environment for consumers purchasing food items for human consumption. Under the proposed amendment, the retail sale of food and food ingredients would continue to be taxed at a reduced rate of four percent (4%). However, the bill notably introduces a significant exemption for the retail sale of fresh, frozen, or canned fruit and vegetables, which would be exempt from the sales tax altogether. This change is aimed at easing the financial burden on consumers and promoting healthier dietary choices through greater access to essential food items.

Contention

While the bill has gained support for its intention to support consumer purchasing power and health, there may be points of contention regarding the implications for state revenue. Critics may argue that by eliminating the tax on certain food items, the state could face reductions in tax revenues that fund essential services, raising concerns about budgetary impacts. Discussions surrounding the bill may also focus on its broader implications in the context of existing tax policies and potential disparities in the treatment of various food products. Ultimately, the debate could center on finding a balance between promoting public health and ensuring adequate funding for state initiatives.