House Bill 1767 proposes an amendment to Tennessee Code Annotated, Title 67, Chapter 6, to establish a sales tax exemption for the retail sale of food and food ingredients for eligible families. The bill defines an "eligible family" as one with an annual household income not exceeding 300% of the threshold for free or reduced-price lunch eligibility, and that has a qualifying child or relative claimed as a dependent for federal tax purposes. To obtain the exemption, eligible families must apply to the commissioner of revenue, providing proof of eligibility, such as a recent federal income tax return. Upon approval, they will receive a sales and use tax exemption certificate and a wallet-sized card to present to retailers.

The bill outlines the process for retailers to document the exemption, requiring them to record the exemption account number and maintain a copy of the exemption certificate. The act will take effect upon becoming law for the purpose of promulgating rules and forms, while the full provisions will be effective starting July 1, 2026.