Governor Bill Haslam joined State Rep. Eric Watson (R–Cleveland) for a bill signing ceremony in recognition of legislation passed by the Tennessee General Assembly that lowered the sales tax on groceries from 5.25 percent to a flat 5.00 percent rate.
The legislation builds on the success of a law adopted by Republicans in 2012 that lowered the sales tax on food from 5.5 percent to 5.25 percent, officials said. In total, the sales tax reduction this year will provide Tennessee taxpayers with over $25 million in tax relief. In 2008, Rep. Watson sponsored legislation to reduce the tax on groceries, but the bill was unsuccessful after being blocked by House Democrats.
“We’re lowering taxes and balancing the state budget by managing conservatively, making strategic investments in our priorities and finding new ways to make government more efficient and effective,” Governor Haslam said. “The sales tax on food impacts all Tennesseans, and I applaud the General Assembly for passing this important piece of legislation this year.”
"This new bill represents a promise made by Republicans to cut taxes and put more money back in the pockets of all Tennesseans,” stated Rep. Watson. “I am proud to co-sponsor this legislation and look forward to finding additional ways to ease the monetary burdens associated with the downturn in today’s economy over the coming weeks and months.”
The reduced tax rate does not apply to prepared foods such as a meal at a restaurant, candy, alcoholic beverages or tobacco.
Bill signing ceremony that lowers sales tax on food from 5.5 percent to 5.25 percent.