Amends and adds to existing law to exempt food from sales tax and to revise sales tax distributions.

For FY 2026, the net impact to the General Fund is a decrease of $365 million. This included the reduction in general fund revenue from exempting sales tax collections on the food at $406 million. The bill increases the revenue sharing to local units of government, from 11.5 percent to 13.2 percent. The change in the revenue sharing percentage exactly offset the reduction in the base of total sales tax collections. Without changing the percentage, local government units would see a reduction of $46.7 million in revenue sharing. Raising the percentage for revenue sharing to local units of government restores the revenue to those units by $46.7 million. The local units of government are held harmless, and this is a wash for the general fund because the exact same dollar amount is shared with local units of government with or without passage of the bill. Other distributions of sales tax collections are affected by grocery tax repeal because they are determined as a percentage of net sales