House Bill 1767 amends Tennessee Code Annotated, Title 67, Chapter 6, by introducing a new section, 67-6-359, which provides a sales tax exemption for the retail sale of food and food ingredients to eligible families. To qualify for this exemption, families must submit an application to the commissioner of revenue, including proof of eligibility such as a copy of their most recent federal income tax return. If approved, the department of revenue will issue a sales and use tax exemption certificate and a wallet-sized card to the family, which must be presented to retailers to document the exemption.

The bill defines "eligible family" as one with an annual household income not exceeding 300% of the threshold for free or reduced-price lunch eligibility, as determined by the USDA, and must have a qualifying child or relative claimed as a dependent for federal tax purposes. The act will take effect upon becoming law for the purpose of promulgating rules and forms, while the tax exemption provisions will be effective starting July 1, 2026.