Tennessee sales tax holidays offer opportunities to save
Limited opportunities to shop in Tennessee free of high sales taxes are arriving.
The General Assembly this year approved a new sales tax holiday to eliminate the tax on groceries during all of August. Food and food ingredients are normally subject to a 4% state sales tax and the applicable local sales tax rate.
Lawmakers also continued Tennessee’s annual sales tax holiday on clothing, school supplies, and computers, which today and run through Sunday July 31.
Tennessee has no state income tax and relies heavily on its 7% sales tax. The maximum local sales tax rate is 2.75%, for a total of 9.75% in Hardin County. Statewide, the average combined sales tax rate is 9.55%, according to the nonprofit Tax Foundation.
State Sen. Page Walley (R-Bolivar) supported the new tax cut on groceries.
“The cost of living continues to rise due to historic inflation, and the need for groceries remains constant. Suspending the grocery tax is one way the state can provide direct relief to all Tennesseans,” he said.
The month-long grocery sales tax holiday in August applies to food and food ingredients. However, it does not include prepared food, alcohol, dietary supplements, tobacco or candy. The state will replace local revenue lost, so local governments’ budgets will not be affected by this tax reduction.
Tennessee’s traditional sales tax holiday weekend occurs before students go back to school each year and exempts sales tax on clothing items $100 or less, school and art supplies $100 or less, and computers for personal use that are $1,500 or less.
Walley said he hopes “all citizens will take advantage of this relief and also shop at local businesses to support jobs and our Tennessee small businesses.”
Legislation passed by the General Assembly this year provided a sales tax holiday on gun safes and safety devices. The year-long holiday began on July 1 and ends on June 30, 2023.