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Tennessee's month-long grocery sales tax holiday is underway

During the month of August, buyers could save anywhere between $5 to $10 on a $100 grocery bill.

MEMPHIS, Tenn. — A month-long tax-free holiday on groceries has begun in Tennessee.

In April, Tennessee lawmakers approved Governor Bill Lee's $52.8 billion dollar budget, which included a 30-day suspension of the tax on groceries, beginning on August 1 and ending at 11:59 p.m. on August 31.

Gov. Lee said in March, “Suspending the grocery tax is the most effective way to provide direct relief to every Tennessean." 

The suspension on the grocery sales tax is specifically for food and food ingrediants.  It does not include alcoholic beverages, tobacco, candy, dietary supplements or prepared food.

RELATED: Expert: Monthlong Tennessee tax-free holiday could save people about $30

According to the Tennessee Department of Revenue, the sales tax rate on food is 4%. These foods are packaged or in their original form and not prepared or served as a ready-to-eat meal.

Here’s a list of some items currently taxed at this rate:

  • baby food
  • bottled water
  • bread
  • canned foods
  • cereal
  • chips, dips
  • coffee
  • condiments
  • eggs
  • raw fish, meat, poultry
  • fruit
  • herbs and spices
  • ice cream
  • lunch meat
  • uncooked pasta
  • salad dressings
  • soft drinks
  • trail mix
  • vegetables
  • yogurt

Prepared food, candy, dietary supplements, tobacco & alcoholic drinks, are taxed at 7% plus local sales tax.

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