Hendersonville pushing to reduce grocery tax
The city passed a sales tax increase, but a new vote could remove groceries from the higher tax bill.
HENDERSONVILLE, Tenn. (WSMV) - Hendersonville City Council wants to make groceries less expensive for its residents under a new proposal.
Earlier this year, the public approved a referendum increasing the sales tax from 2.25% to 2.75% for the next 10 years to help pay for infrastructure improvements.
The city is now trying to remove groceries from that increase to help families afford the rising cost of living. The proposal would bring the grocery tax back down to the old 2.25% rate if it is passed by the council. The state grocery tax rate of 4% would not change.
“I am amazed just when I go to the store what happens,” Mayor Jamie Clary said about tax being added onto his bill. “I hear from folks all the time that when they get their tax bill or they understand what is happening in the city, they see that things just cost more. Our trash costs have just taken off so much in the past five years. I’m constantly having to remind people that inflation isn’t just on what you are buying at the stores, it’s also what the city has to pay.”
Clary said the tax cut would save taxpayers around $800,000 a year on their grocery tax. People would still pay the higher sales tax rate on other items.
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This proposal would not be possible without a new law Hendersonville pushed the General Assembly to pass. Last month, Governor Bill Lee signed a law allowing city governments to lower grocery tax rates.
“We knew that the general assembly wouldn’t let us (completely eliminate the grocery tax),” Clary said. “But we wanted them to give us some flexibility so the increase in our sales tax that people wanted wouldn’t impact people in a negative way too much.”
Tennessee has done grocery tax holidays in the past, most recently in 2023 where it reportedly saved the average family roughly $100 during the 3-month pause.
Shoppers like Andrew Zannella said the tax cut will be very helpful for families. He moved to Hendersonville from New York looking for a lower cost of living but said prices here have more than doubled over the past couple of years.
“It would help everybody,” Zannella said. “Wherever you save is where you can apply that money towards whatever else. If you’ve got kids, education.”
The first reading of the proposal is scheduled for Tuesday night in Hendersonville. If the council passes the lower the tax, the proposal will require an additional vote before it is officially instated.
Mayor Clary said it would take a couple of months to work with the state tax department to implement the change. He is hopeful it will be in place by January or February 2025.
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