Taxes, Sales - As introduced, exempts from the state sales and use tax the retail sale of food and food ingredients. - Amends TCA Title 57, Chapter 3 and Title 67.

HB 21 would exempt the retail sale of food and food ingredients from Tennessee's state sales tax, directly affecting grocery stores, restaurants, and other food retailers. The bill modifies tax code references to remove existing exemptions for food sales and requires counties/municipalities to receive allocated funds based on exempt food sales, replacing prior K-12 education funding from a 0.5% tax rate. Key provisions include updating tax code sections to reflect the exemption and adjusting business requirements for food sales. The changes take effect July 1, 2025, after committee review.