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Tennessee grocery tax holiday could be permanent if corporations paid what they owed
Submitted by Tennessee for All
September 1, 2022

According to a report from the Institute for Economic Policy Institute, more than 60% of corporations filing in Tennessee pay zero in state corporate income taxes.

NASHVILLE, TN -- On Thursday, the one-month grocery tax holiday in Tennessee ended. Rep. Vincent Dixie had proposed a 6-month suspension of the grocery tax in 2021 that was not adopted. Governor Bill Lee proposed a one-month suspension in March of this year that did pass to soften the blow of inflation.

Most states don’t have a grocery tax, but Tennessee families pay among the highest grocery tax rates in the country. According to the Center on Budget and Policy Priorities, “sales taxes on groceries have an especially harmful impact on income and racial inequities since low-income families tend to spend a larger share of their income on groceries.”

While families are paying high tax rates on sales and groceries, a report from the Economic Policy Institute revealed that more than half of corporations in Tennessee are paying nothing in state corporate income tax. The EPI estimates that between $43 billion and $57 billion in national revenue has been lost due to the lack of corporate income tax payments. The Tennessee for All coalition says that if corporations paid what they owed, Tennessee families could never pay grocery taxes again.

The Rev. Francisco García, Assistant Chaplain at St. Augustine's Episcopal Chapel in Nashville, said, “Groceries are one of the biggest expenses for families and it’s not fair that they are paying taxes on basic needs while corporations are not paying their fair share. Getting rid of the grocery tax forever would be a huge help to families across Tennessee.”

“There’s no loophole for me to not pay taxes at the grocery store, I can’t think of any reason a profitable corporation should have a zero in their tax bill,” added Jaime Barks, a mother of two in Chattanooga.

Liv Cook, a teacher from McMinn County added, “I pay taxes on food I buy for school events out of my own pocket because we don’t have adequate funding, but a corporation that makes millions gets to pay nothing, it’s just not fair.”

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