I 
119TH CONGRESS 
1ST SESSION 
H. R. 701 
To 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. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 23, 2025 
Ms. SHERRILL (for herself and Mrs. HAYES) introduced the following bill; 
which was referred to the Committee on Ways and Means 
A BILL 
To 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. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Restoring Establish-
ment Deductions and Uplifting Competition to Ease Food 
Prices Act’’ or the ‘‘REDUCE Food Prices Act’’. 
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SEC. 2. INCREASED REHABILITATION TAX CREDIT FOR 
QUALIFIED 
SMALL 
FOOD 
RETAIL 
BUSI-
NESSES. 
(a) IN GENERAL.—Section 47 of the Internal Rev-
enue 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 GENERAL.—In 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
BUSI-
NESS DEFINED.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (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 attrib-
utable to the retail sale of food or produce, 
and 
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‘‘(iii) which is located in a low-com-
petition area. 
‘‘(B) LOW-COMPETITION AREA.—For pur-
poses of subparagraph (A), the term ‘low-com-
petition 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 Depart-
ment of Agriculture, is at or above a level of 
1,400.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 3. INCREASED WORK OPPORTUNITY TAX CREDIT FOR 
QUALIFIED 
SMALL 
FOOD 
RETAIL 
BUSI-
NESSES. 
(a) IN GENERAL.—Section 51(b)(3) of the Internal 
Revenue Code of 1986 is amended— 
(1) by striking ‘‘The amount’’ and inserting 
‘‘(A) IN GENERAL.—The amount’’, and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) INCREASED LIMITATION FOR QUALI-
FIED
SMALL
FOOD
RETAIL
BUSINESSES.—In 
the case of wages paid by an employer that is 
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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 DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 4. INCREASED BONUS DEPRECIATION FOR QUALIFIED 
SMALL FOOD RETAIL BUSINESSES. 
(a) IN GENERAL.—Section 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
PERCENT-
AGE
FOR
PROPERTY
PLACED
IN
SERVICE
BY 
QUALIFIED
SMALL
FOOD
RETAIL
BUSI-
NESSES.—In the case of property placed in 
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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 per-
cent’ for ‘20 percent’ each place it ap-
pears, 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 per-
cent’ for ‘20 percent’ each place it ap-
pears. 
‘‘(B) INCREASED
APPLICABLE
PERCENT-
AGE FOR PLANTS BEARING FRUITS AND NUTS 
PLANTED OR GRAFTED BY QUALIFIED SMALL 
FOOD
RETAIL
BUSINESSES.—In the case of 
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plants bearing fruits and nuts planted or graft-
ed by a taxpayer that is a qualified small food 
retail 
business 
(as 
defined 
in 
section 
47(e)(2)(A)), paragraph (6)(C) shall be ap-
plied— 
‘‘(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 DATE.—The 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. 
SEC. 5. INCREASED QUALIFIED BUSINESS INCOME DEDUC-
TION FOR QUALIFIED SMALL FOOD RETAIL 
BUSINESSES. 
(a) IN GENERAL.—Section 199A of the Internal Rev-
enue 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 BUSINESSES.—In the case of a qualified small 
food retail business (as defined in section 47(e)(2)(A)), 
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subsection (a)(2) shall be applied by substituting ‘25 per-
cent’ for ‘20 percent’.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 6. NEW FOOD RETAIL BUSINESS TAX CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new 
section: 
‘‘SEC. 45BB. NEW FOOD RETAIL BUSINESS CREDIT. 
‘‘(a) IN GENERAL.—For 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 invest-
ment amounts paid or incurred during the taxable year. 
‘‘(b) DEFINITIONS.—For purposes of this section— 
‘‘(1) NEW FOOD RETAIL BUSINESS.—The 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 pre-
vious three taxable years. 
‘‘(2) QUALIFIED INVESTMENT AMOUNTS.—The 
term ‘qualified investment amounts’ means amounts 
paid for capital investment in the property, facilities, 
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or equipment of a business premises used for retail 
sales of the new food retail business.’’. 
(b) CREDIT PART OF GENERAL BUSINESS CREDIT.— 
Section 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 deter-
mined under section 45BB(a).’’. 
(c) CLERICAL AMENDMENT.—The 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 add-
ing at the end the following new item: 
‘‘Sec. 45BB. New food retail business credit.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
Æ 
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