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Tennessee bill would exempt groceries from sales tax for May through October 2021

H.B. 1071 would exempt food items from sales tax for six months, and then reimburse counties and municipalities for the loss of revenue.

NASHVILLE, Tenn. — Tennessee lawmakers want to shrink families' grocery bills this legislative session. To do that, they introduced a new bill that would exempt food from state sales tax.

The bill, H.B. 1071, was introduced by Representative Vincent Dixie (D - District 54). If passed, a sales tax would not be applied to groceries between May 1 and October 31. Families would be able to leave grocery stores spending a little less on basic items.

Stores would need to report the amount of money from tax-exempt sales to the state, the bill says. Then, the Commissioner of Revenue would reimburse the counties and municipalities for revenue that may have been lost during the six-month period.

Dixie said that the bill would save a family of four around $100 per month, and would cost the state between $20 million and $24 million. However, he said that the state's "rainy day" fund could cover it since he said it totals around $1.5 billion.

A Senate subcommittee will take the bill up next week, on March 23.

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