Last updated on August 27th, 2024 at 03:33 pm
The Shelby Report of the Southeast recently visited with Rob Ikard, president and CEO of the Tennessee Grocers & Convenience Store Association (TGCSA), to learn more about the legislation and public policy updates impacting retailers in the Volunteer State.
Calling the 2024 legislative session “quite busy,” Ikard said TGCSA spent many long hours advancing the interests of its retail and supplier members.
Swipe fees, vendors’ compensation
For the fourth session in a row, TGCSA led the effort to pass a law prohibiting payment card companies from levying interchange fees (swipe fees) on the tax collection portion of a transaction.
Running parallel legislation that would restore a vendor’s allowance for serving the state as its primary tax collector helped to highlight the unfair burden on retailers, Ikard noted.
TGCSA succeeded in amending the vendors’ comp legislation to require a formal study by the Tennessee Advisory Council on Intergovernmental Relations, which will formalize for lawmakers many of the arguments that TGCSA has been pressing.
“We go into 2025 encouraged on this issue, as Illinois just passed almost identical swipe fee legislation during its session, supported by a downward modification of that state’s vendors’ comp arrangement,” Ikard said.
Local food sales tax rate
Tennessee retailers may need to start tracking different local sales tax rates for food items, after approval of a bill that allows local governments to charge less if they choose.
“With the state experiencing slowing growth in tax revenues, 2024 was not a year to hold a food sales tax holiday, as it had for the previous two years. But the General Assembly did give local governments this flexibility, which could lower food costs for consumers,” Ikard explained.
It will be up to individual retailers to decide. So far one municipality – Hendersonville, in Middle Tennessee – has adopted a lower food sales tax rate, he noted.
Comptroller report on RAP
The comptroller of the treasury, one of Tennessee government’s “constitutional officers,” is performing a study of the Retailer Accountability Program.
Established in 2012, this program of the Tennessee Department of Revenue compares cigarette and beer wholesaler sales with the retailers’ sales tax returns to determine if the latter are filing correct reports.
In 2015, the program was expanded to include reporting on sales of most items found in grocery stores. After strong pushback from TGCSA, requirements for many items were dialed back.
Ikard noted the expanded program was supposed to expire in 2018, but the revenue department has repeatedly succeeded in passing legislation to extend it.
“Being set to expire again in 2025, TGCSA lobbied for the comptroller’s study, hoping this independent third party could certify the expanded program’s value to the state…or lack thereof.”
Cold beer sales
TGCSA led the push against a bill that would have banned the sale of cold beer statewide.
“While the author of the bill was well-intended in his attempt to curb drunk driving in Tennessee, he was doubtful of our warning that our customers would not be excited about his bill,” Ikard said.
He added that the bill’s author changed his mind after hearing all the opposition.
License plate design
Included in the annual license plate “omnibus bill” was a provision authorizing the state to produce a specialty license plate, the proceeds from which would benefit the scholarship programs of the Tennessee Grocers Education Foundation.
TGCSA now has about one year to pre-sell a minimum of 1,000 plates before the state will begin production. According to Ikard, the proposed design, which still needs state approval, highlights Tennessee’s iconic flag.
[RELATED: TGCSA Recognizes 2024 Retailer, Supplier Of The Year]
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