House Bill 21 amends various sections of the Tennessee Code Annotated related to the taxation of food and food ingredients. The bill establishes that the retail sale of food and food ingredients shall not be taxed, while also introducing a new provision that allows for the taxation of food and food ingredients under a specific part of the tax code. Additionally, it modifies the allocation of revenue generated from sales tax, ensuring that counties and municipalities receive an amount equivalent to what they would have received if food sales were not exempt from sales tax.

The bill also makes several deletions and substitutions in existing legal language to clarify the definitions and requirements related to food sales. For instance, it removes references to the tax rate for food and food ingredients and instead focuses on the overall sales from these items. The changes aim to streamline the tax code and ensure that local governments are adequately funded despite the exemption of food sales from taxation. The act is set to take effect on July 1, 2025.

Statutes affected:
Introduced: 67-6-228(a), 67-6-228, 67-6-103(c)(2), 67-6-103, 67-6-103(u), 67-6-329(a), 67-6-329, 67-6-329(a)(18), 67-6-229, 57-3-802(1), 57-3-802, 57-3-806(d)(1), 57-3-806