Tennessee Governor Proposes Pause To Grocery Tax Amid ‘Surging’ Inflation

Gov. Bill Lee (R-TN) proposed a pause to the state’s grocery tax amid worsening inflation.

The move comes two weeks after the Department of Labor announced that the consumer price inflation reached a 7.9% rate in February — a four-decade high. Lee argued that a 30-day pause on the state’s 4% grocery tax would “provide direct financial relief” to Tennesseans struggling with rising price levels. 

“As Americans see their cost-of-living skyrocket amid historic inflation, suspending the grocery tax is the most effective way to provide direct relief to every Tennessean,” Lee said in a statement. “Our state has the ability to put dollars back in the pockets of hardworking Tennesseans, and I thank members of the General Assembly for their continued partnership in maintaining our fiscally conservative approach.”

Lee is including the proposal in a budget amendment for the next fiscal year, which will be delivered on March 29. 

The Tennessean reported that the move comes after two Democratic state representatives called on Lee to pause the state’s collection of gas taxes for 90 days for the “benefit of Tennessee’s working families.” Residents currently pay a gas tax slightly above $0.27.

Indeed, governors and lawmakers across the United States are considering measures to ease inflationary pressures weighing on their constituents.  

Gov. Gavin Newsom (D-CA) recently shared details about his effort to send $400 to California residents for each registered vehicle. The $11 billion plan is meant to help with soaring fuel expenses in California, where the current average price is $5.88 per gallon.

Newsom, however, pinned the blame on Russian President Vladimir Putin, failing to mention the role of the Biden administration in opposing the expansion of new energy projects.

“We’re taking immediate action to get money directly into the pockets of Californians who are facing higher gas prices as a direct result of Putin’s invasion of Ukraine,” Newsom said in a statement. “But this package is also focused on protecting people from volatile gas prices, and advancing clean transportation — providing three months of free public transportation, fast-tracking electric vehicle incentives and charging stations, and new funding for local biking and walking projects.”

Gas prices — which have ripple effects upon nearly every facet of the American economy — are having a direct impact on groceries. Beyond the fuel needed to transport foods across the nation, grocery delivery company Instacart announced a gas surcharge on Friday, raising the price of each order by $0.40. 

“In a time of increased fuel costs across North America, we know that every cent counts, and we’re hopeful this temporary fuel assistance will help offset some of the near-term challenges that shoppers are facing,” Instacart Vice President of Operations and Care Tom Maguire said in a statement.

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