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From Staff Reports
From August through October 2023, Tennesseans will not pay tax on most food and food ingredients sold in grocery stores. The grocery tax holiday was approved by the Tennessee General Assembly, and will begin at 12:01 a.m. on Tuesday, Aug. 1, and end at 11:59 p.m. Tuesday, Oct. 31.
The tax-relief does not include alcoholic beverages, tobacco, candy, dietary supplements, or prepared food.
The governor’s office said additionally, local governments will be reimbursed by the state for any tax revenues lost during the period.
State lawmakers passed the Tennessee Works Tax Act, a bill promoted by Governor Bill Lee. The legislation calls for more than $400 million in tax cuts, including $272 million for this year’s three-month grocery tax holiday.
The governor’s office said the tax holiday will save each Tennessee family more than $100 in taxes on average.
“Decades of smart fiscal stewardship have enabled Tennessee to maintain a balanced budget while cutting taxes for Tennessee families and businesses,” said Gov. Lee. “We are proud to continue that legacy this year by putting dollars back in the pockets of Tennesseans and supporting future economic growth across Tennessee, and I thank the General Assembly for its partnership to promote future growth and opportunity for our state.”
The governor’s office said additionally, local governments will be reimbursed by the state for any tax revenues lost during the period.
Part of the same bill is an optional state paid family leave tax credit for companies that mirrors a similar federal credit. A company offering paid family leave may be eligible for a maximum 50% franchise and excise tax credit.