REDUCE Food Prices Act

119 HR 701 IH: Restoring Establishment Deductions and Uplifting Competition to Ease Food Prices Act U.S. House of Representatives 2025-01-23 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain. I119th CONGRESS1st SessionH. R. 701IN THE HOUSE OF REPRESENTATIVESJanuary 23, 2025Ms. Sherrill (for herself and Mrs. Hayes) introduced the following bill; which was referred to the Committee on Ways and MeansA BILLTo amend the Internal Revenue Code of 1986 to provide tax incentives for the establishment and operation of small food retail businesses in areas with high food retail concentration and low levels of competition.1.Short titleThis Act may be cited as the Restoring Establishment Deductions and Uplifting Competition to Ease Food Prices Act or the REDUCE Food Prices Act.2.Increased rehabilitation tax credit for qualified small food retail businesses(a)In generalSection 47 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (e)Special rule for qualified small food retail businesses(1)In generalIn the case of a qualified rehabilitated building placed in service by a qualified small food retail business, subsection (a)(2) shall be applied by substituting 25 percent for 20 percent.(2)Qualified small food retail business defined(A)In generalFor purposes of paragraph (1), the term qualified small food retail business means a business—(i)which is described in section 38(c)(5) (determined by applying $200,000,000 for $50,000,000 in such section), (ii)at least 70 percent of the annual average gross receipts of which are attributable to the retail sale of food or produce, and(iii)which is located in a low-competition area. (B)Low-competition areaFor purposes of subparagraph (A), the term low-competition area means a county with respect to which the Herfindahl-Hirschman Index for the retail food sector, as measured by the Economic Research Service of the United States Department of Agriculture, is at or above a level of 1,400..(b)Effective dateThe amendment made by this section shall apply to property placed in service after the date of the enactment of this Act.

3.Increased work opportunity tax credit for qualified small food retail businesses(a)In generalSection 51(b)(3) of the Internal Revenue Code of 1986 is amended—(1)by striking The amount and inserting (A)In generalThe amount, and (2)by adding at the end the following new subparagraph: (B)Increased limitation for qualified small food retail businessesIn the case of wages paid by an employer that is a qualified small food retail business (as defined in section 47(e)(2)(A)), subparagraph (A) shall be applied—(i)by substituting $8,000 for $6,000,(ii)by substituting $14,000 for $12,000,(iii)by substituting $16,000 for $14,000, and(iv)by substituting $26,000 for $24,000..(b)Effective dateThe amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

4.Increased bonus depreciation for qualified small food retail businesses(a)In generalSection 168(k) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: (10)Special rule for qualified small food retail businesses(A)Increased applicable percentage for property placed in service by qualified small food retail businessesIn the case of property placed in service by a taxpayer that is a qualified small food retail business (as defined in section 47(e)(2)(A)), paragraph (6) shall be applied—(i)in subparagraph (A)—(I)by substituting 70 percent for 60 percent each place it appears,(II)by substituting 50 percent for 40 percent each place it appears, and(III)by substituting 30 percent for 20 percent each place it appears, and(ii)in subparagraph (B)—(I)by substituting 70 percent for 60 percent each place it appears,(II)by substituting 50 percent for 40 percent each place it appears, and(III)by substituting 30 percent for 20 percent each place it appears.(B)Increased applicable percentage for plants bearing fruits and nuts planted or grafted by qualified small food retail businessesIn the case of plants bearing fruits and nuts planted or grafted by a taxpayer that is a qualified small food retail business (as defined in section 47(e)(2)(A)), paragraph (6)(C) shall be applied—(i)by substituting 70 percent for 60 percent each place it appears,(ii)by substituting 50 percent for 40 percent each place it appears, and(iii)by substituting 30 percent for 20 percent each place it appears..(b)Effective dateThe amendments made by this section shall apply to property placed in service, or plants planted or grafted, after the date of the enactment of this Act.

5.Increased qualified business income deduction for qualified small food retail businesses(a)In generalSection 199A of the Internal Revenue Code of 1986 is amended by redesignating subsection (i) as subsection (j) and by inserting after subsection (h) the following new subsection: (i)Special rule for qualified small food retail businessesIn the case of a qualified small food retail business (as defined in section 47(e)(2)(A)), subsection (a)(2) shall be applied by substituting 25 percent for 20 percent. .(b)Effective dateThe amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.6.New food retail business tax credit(a)In generalSubpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:45BB.New food retail business credit(a)In generalFor purposes of section 38, in the case of a new small food retail business, the new food retail business credit under this section for the taxable year is an amount equal to 15 percent of qualified investment amounts paid or incurred during the taxable year. (b)DefinitionsFor purposes of this section—(1)New food retail businessThe term new food retail business means a qualified small food retail business (as defined in section 47(e)(2)(A)) which began operations during the previous three taxable years. (2)Qualified investment amountsThe term qualified investment amounts means amounts paid for capital investment in the property, facilities, or equipment of a business premises used for retail sales of the new food retail business..(b)Credit part of general business creditSection 38(b) of the Internal Revenue Code of 1986 is amended by striking plus at the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting , plus, and by adding at the end the following new paragraph:(42)the new food retail business credit determined under section 45BB(a)..(c)Clerical amendmentThe table of sections for subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:Sec. 45BB. New food retail business credit..(d)Effective dateThe amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.