Sales, Use and International Tax Activity Update - May 2012
Tennessee Eats Part of Sales Tax on Food
House Bill 3761/Senate Bill 3763, passed by the legislature on April 27, 2012, provides for a reduction in the state sales and use tax rate on sales of food and food ingredients. Effective July 1, 2012, the state sales and use tax rate on sales of food and food ingredients will be reduced from 5.5% to 5.25%.
Businesses selling food items subject to the reduced rate of sales and use tax are advised to begin making the necessary changes to allow for the new rate beginning July 1, 2012. Changes to cash registers and accounting systems should be completed by the July 1, 2012 effective date. However, businesses must continue to collect and remit the existing 5.5% tax on sales of food and food ingredients made through June 30, 2012 to the Department of Revenue.
Tennessee Department of Revenue Notice # 12-04
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