Tennessee has One of the Highest Food Taxes in the Nation

Reducing the Food Tax is About Fairness

Most states recognize that taxing food is simply cruel and unfair. In fact, 42 states do not tax food or tax it at a reduced rate (30 states fully exempt food from both state and local taxes, 5 states apply only local taxes, and 7 states tax food at a reduced rate). Only 8 states apply their full sales tax to food, and even then, five of those offer special tax credits to help offset the tax.

With an average state and local rate of 7.85% (effective January 1, 2008), Tennessee still has the third highest average food tax in the nation, which puts and unfair burden on low- and middle-income families while at the same time, making it hard for grocers in border counties to compete. 

Why cut the food tax?

• Every two percentage points cut from the state and local food tax saves every Tennessee family enough to buy over a week's worth of groceries.
• Grocers in border communities would benefit as fewer shoppers leave the state. With half of the state population living in counties that border another state, shoppers leave the state every day to buy their groceries elsewhere.

Avg. state and local food tax rates in Tenn. and border states.

So what are other states doing?

• Kentucky eliminated its food tax decades ago.
• Oct. '97 - Missouri reduced its food tax by 3%.
• Oct. '98 - Georgia eliminated its state tax on food.
• May '99 - N. Carolina eliminated its state food tax.
• Jan. '00 - Virginia reduced its food tax to 4%.
• Jan. '03 - Louisiana eliminated its state food tax.
• July '05 - Virginia reduced its food tax to 2.5%.
• Oct. '06 - South Carolina cut its food tax by 2%.
• July '07 - Arkansas cut its state food tax cut in half.
• Nov. '07 - South Carolina eliminated its state food tax.
• Jan. '08 - Tennessee reduced cut its food tax by a half percent.