Senate Bill 1702 amends Tennessee Code Annotated, specifically Section 67-6-702, to clarify the definition of "city tax rate" and provide new provisions for cities and metropolitan governments regarding the taxation of food and food ingredients. The bill replaces the existing language in subdivision (a)(1)(B) with a new definition that distinguishes between cities in counties that have not adopted the maximum tax rate and metropolitan governments. It allows cities and metropolitan governments to levy a lower tax rate on the retail sale of food or to exempt such sales from the city tax rate, while still permitting the collection of a surcharge on food sales by metropolitan governments.

Additionally, the bill mandates that any city or metropolitan government that adopts a new tax rate or exemption must provide a certified copy of the ordinance or resolution to the Department of Revenue. The new tax rate or exemption will take effect on the first calendar day of the month that is at least sixty days after the Department receives the certified copy, with specific effective dates for incorporated cities (October 1, 2024) and metropolitan governments (October 1, 2026). The act is set to take effect upon becoming law, emphasizing the public welfare.

Statutes affected:
Introduced: 67-6-702