House Bill 2007, known as the "End the Grocery Tax Act," proposes significant changes to the taxation of food and food ingredients in Tennessee. The bill amends Tennessee Code Annotated, Section 67-6-228(a), to exempt the retail sale of food and food ingredients from taxation. Additionally, it removes the requirement that revenue from a portion of the tax rate be earmarked for education purposes, thereby eliminating the stipulation that revenue generated from 0.5% of the tax rate must continue to be deposited in the state general fund for K-12 education, regardless of any tax rate reductions.

Further amendments include provisions for the allocation of funds to counties and municipalities based on the exempt sales of food and food ingredients, ensuring they receive an amount equivalent to what would have been allocated without the tax exemption. The bill also makes various deletions and substitutions in existing legal language to clarify the definitions and requirements related to food sales. The act is set to take effect on July 1, 2026, contingent upon public welfare considerations.

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, 67-6-702(a), 67-6-702, 67-6-705, 57-3-802(1), 57-3-802, 57-3-806(d)(1), 57-3-806