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The Tennessee Conservative [By Olivia Lupia] –
Two separate bills proposing the elimination of the state grocery sales tax for certain foods are still technically alive, but they must face the scrutiny of the Finance, Ways, and Means Committees in both chambers, which is often a death knell for bills which come with a cost to the state.
SB2337 is titled the “Healthy Tennessee Grocery Tax Reform of 2026” and seeks to exempt a variety of fresh foods and ingredients from the state’s 4% state grocery tax. Items specifically listed in the bill to be exempted include fresh and frozen produce, raw meat, poultry, and fish, eggs, flour, cornmeal, dried legumes and beans, bread, unsweetened cereal, dairy, and 100% fruit and vegetable juice.
SB2337 has been referred by the Senate Finance, Ways, & Means Revenue Subcommittee to the full Senate Finance, Ways, & Means Committee, but with a negative recommendation, signaling the committee is not fully confident in or supportive of the bill. It does not mean the legislation is dead, but it does represent an uphill battle for bill sponsors to justify losing a significant revenue stream for the state.
The House companion bill, HB2570, is scheduled to be heard in the House Finance, Ways, and Means Subcommittee today, March 18. The bill will likely end up being placed behind the budget as it carries the same fiscal note. Again, this does not signify the proposal is completely dead, but it could be difficult for sponsors to convince committee members the legislation is worthwhile.
The second bill, SB2277, is a bipartisan effort sponsored by Republican Sen. Richard Briggs and Democrat Rep. Sam McKenzie. This bill would exempt from the 4% state tax “generic food products” which are defined as “food products for which a grocery wholesaler or grocery retailer contracts with a third party to produce on behalf of and under the brand of the grocery wholesaler or grocery retailer.”
This is likely intended to apply to in-house brands carried by retailers like Walmart’s Great Value line or Kroger’s Simple Truth label which often offer a mix of fresh and processed or prepared options.
SB2277 experienced the same outcome as SB2337, being referred to the Senate Finance, Ways, & Means Committee with a negative recommendation due to its fiscal note.
House companion HB2437 has already been placed behind the budget by the House Finance, Ways, and Means Subcommittee.
And these two proposals are not the only ones the legislature has sidelined this session. HB1530 by Rep. Todd Warner would have eliminated the 4% state grocery tax in its entirety with a few exceptions but has also been placed behind the budget in the House and referred to the Senate Finance, Ways, & Means Committee with a negative recommendation.
Rep. Warner is not optimistic that his bill will be pulled from behind the budget due to its “sizeable fiscal impact” , and expressed his frustration with its dismissal, especially as GOP leadership made assurances last year that Republicans would address the issue this session.
He previously stated that lawmakers’ concerns about the lost revenue may be unfounded as he believes the cuts would not create as big of a deficit as predicted because the money taxpayers save on the grocery tax would likely be reinvested in the economy in other ways.
“When you give people money back, they spend it on other things. So, the state’s not going to necessarily miss that money. They say we’re going to lose $800 million, that’s a lie. Because when you give families back money from the grocery tax, they’re going to spend it on clothes, they’ll spend it on a new vehicle, hopefully they can buy a house, save money and get a down payment on a house, the state gets a transfer tax on that real estate, there’s all kind of ways the state can make it up,” Warner said.
The fate of these three bills may not be totally sealed yet, but despite increasing bipartisan support for tackling the issue, Republicans do not appear overly committed to seriously considering how to make any of these proposals work.
About the Author: Olivia Lupia is a political refugee from Colorado who now calls Tennessee home. A proud follower of Christ, she views all political happenings through a Biblical lens and aims to utilize her knowledge and experience to educate and equip others. Olivia is an outspoken conservative who has run for local office, managed campaigns, and been highly involved with state & local GOPs, state legislatures, and other grassroots organizations and movements. Olivia can be reached at olivia@tennesseeconservativenews.com.
