Tennessee Governor Bill Haslam yesterday signed legislation at a local grocery store in Vonore that lowers the State tax on groceries from 5.25% to 5%, which marks the second year in a row that the General Assembly has lowered the State's tax on groceries. Last year the tax was lowered from 5.5% to the 5.25% where it currently stands. The new rate will go into effect on July 1st.
“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,” Haslam said in a Monday release. “The sales tax on food impacts all Tennesseans, and I applaud the General Assembly for passing this important piece of legislation this year.” Other members of the General Assembly have said that the fact that Tennessee can cut taxes while other States are looking to raise them in the midst of austerity is a testimony to the Volunteer State's bipartisan tradition of fiscal and economic responsibility.
The new law, passed as House Bill 193, was sponsored by Majority Leader Gerald McCormick (R-Chattanooga) in the House, with numerous co-prime sponsors. Its companion legislation in the Upper Chamber was carried by Senate Majority Leader Mark Norris (R-Collierville). The legislation will not effect local tax rates across Tennessee, which are determined by county legislative bodies and municipal authorities. Legislation that lowers the State grocery tax has largely been made possible because Tennessee has maintained an exceptional fiscal condition during a very bad economic period, and it was seen to be needed in order to further lower Tennesseans' cost of living, especially the working poor.