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Bill

HB 2

Taxes - As introduced, enacts the "End the Grocery Tax by Closing Corporate Loopholes Act." - Amends TCA Title 57 and Title 67.

114th Regular Session (2025-2026) Introduced by Aftyn Behn

Bill proposes eliminating Tennessee's grocery tax by closing unspecified corporate tax loopholes to offset lost revenue, currently deferred for summer study.

Def. to Summer Study in Finance, Ways, and Means Subcommittee
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Bill Summary · HB 2

Legislative bill overview

HB 2 proposes eliminating Tennessee's grocery tax by closing what sponsors characterize as corporate tax loopholes, modifying state tax code in Title 57 and Title 67. The bill has been deferred to summer study in the Finance, Ways, and Means Subcommittee, indicating it requires further development before consideration.

Why is this important

Grocery tax elimination could reduce food costs for all consumers, particularly benefiting lower-income households for whom food represents a larger budget share. However, the bill's revenue offset mechanism—closing "corporate loopholes"—is currently unspecified, making the actual fiscal impact and feasibility unclear.

Potential points of contention

  • Revenue neutrality unclear: The bill lacks detail on which specific loopholes would be closed and whether the resulting revenue would truly offset $500+ million in annual grocery tax collections
  • Definition of "loopholes": Stakeholders will likely dispute whether proposed closures target unintended tax avoidance or intentional policy provisions supporting business investment and competitiveness
  • Implementation complexity: Modifying both Title 57 (corporate franchise/excise tax) and Title 67 (sales tax) requires coordinated changes with uncertain distributional effects across tax bases and business sectors

Compiled from official sources — confirm details with the bill’s official record.

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