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HB 1792

Taxes, Exemption and Credits - As introduced, exempts from the state sales and use tax the retail sale of food and food ingredients that are voucher-eligible under the Special Supplemental Food Program for Women, Infants, and Children (WIC). - Amends TCA Title 67, Chapter 6.

114th Regular Session (2025-2026) Introduced by Monty Fritts

HB 1792 would exempt the sale of WIC-eligible food from Tennessee's state sales tax, reducing state and local revenues starting July 1, 2026.

Taken off notice for cal in s/c Finance, Ways, and Means Subcommittee of Finance, Ways, and Means Committee
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Bill Summary · HB 1792

Summary of HB 1792 (Session 114) – Tennessee

Title

Taxes, Exemption and Credits – As introduced, exempts from the state sales and use tax the retail sale of food and food ingredients that are voucher-eligible under the Special Supplemental Food Program for Women, Infants, and Children (WIC). Amends Tennessee Code Annotated (TCA) Title 67, Chapter 6.

Purpose and intent

  • To exempt from the state sales and use tax the retail sale of food and food ingredients that are eligible for WIC vouchers.
  • The exemption applies to foods and ingredients that are voucher-eligible under the federal WIC program (42 U.S.C. § 1786) and any subsequent federal legislation.

Key provisions

  • New provision added: 67-6-359

    • Exempts the retail sale of food and food ingredients that are voucher-eligible under WIC from the state sales tax.
    • However, such items remain taxable under part 7 of chapter 6, unless exempted by other statutory provisions (specifically 67-6-702(a)(1)(B)).
    • The exemption does not alter potential taxation under other parts of the tax code unless otherwise exempted.

  • Effective date

    • The act takes effect July 1, 2026, contingent on public welfare requiring it.

Who/what is affected

  • Consumers purchasing WIC-eligible food and food ingredients in Tennessee, including items bought with WIC vouchers and, per the bill’s analysis, items purchased with funds other than WIC vouchers that are still WIC-approved.
  • State and local governments:
    • State: Revenue from the state sales tax on food and food ingredients would be reduced.
    • Local: Local option sales taxes collected on food and food ingredients would also be affected; local tax sharing and allocations would be impacted.

Fiscal impact (as analyzed in the fiscal note)

  • State government revenue:
    • Net reduction: approximately $164,016,360 in FY26-27 and subsequent years.

  • Local government revenue (mandatory):

    • Net reduction: approximately $4,695,603 in FY26-27 and subsequent years.

  • Assumptions highlighted in the fiscal note:

    • Local governments currently can levy a tax on the same privilege subject to the state rate; continuation of local collection is assumed.
    • Elimination of the state sales tax on food and food ingredients would also eliminate the state-shared allocation of those collections to local government.
    • Current state sales tax rate on food is 4.0%; the effective local apportionment rate is estimated at 4.0276%.
    • Total sales and use taxes on food and food ingredients were $831,800,466 in FY24-25; projected growth rates are 3.37% in FY25-26 and 3.00% in FY26-27.
    • Estimated total taxable food sales: about $22.14 billion.
    • USDA/BLS-based estimate that 20% of all food sales would become exempt under this legislation (due to WIC eligibility and non-Voucher purchases).

  • Redistribution/rebound effects:

    • The analysis assumes 50% of the tax savings would be spent in the economy on non-food, taxable goods and services, producing small increases in state and local revenue from those sectors.

  • Net effects:

    • The bill would create a net negative impact on state revenue (~$164.0 million) and a smaller net negative impact on local revenue (~$4.7 million) in the first full year after implementation, with ongoing effects in subsequent years.

Procedural/timeline notes

  • Sponsorship:
    • Prime sponsor: Senator Hensley; House sponsor: Representative Fritts; Co-sponsor: Monty Fritts.
  • Status/history:
    • Filed in 2026; various committee considerations noted (Finance, Ways and Means; subcommittees).
    • As of the latest actions, the bill was moved for committee consideration and scheduled for subcommittee hearings in 2026.

Bottom line

HB 1792 would remove the state sales and use tax from the sale of food and food ingredients that are eligible for WIC purchases (including items bought with WIC vouchers or funds other than vouchers, if those items are WIC-approved). The fiscal note projects a substantial negative impact on both state and local tax revenues, with broad implications for revenue sharing and local government funding. The measure would take effect on July 1, 2026, if enacted.

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

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