Where state taxes goTennessee, fiscal 2023
Where do my state taxes go in Tennessee?
Of every dollar Tennessee's state government spends, 36¢ goes to public welfare and 32¢ to education.$44.9 billion of general spending in fiscal year 2023 (July 2022 to June 2023): $6,282 per resident, 48th highest of the 50 states. 42% of the money came from the federal government.
Where the money goes
General spending rose 9.4% on fiscal 2022 ($41.1 billion). The table under the chart has each function per resident, its rank and its change.
Public welfare and education take 68% of Tennessee's spending
State government general expenditure by function, fiscal year 2023 (July 2022 to June 2023). Small print: the share in all 50 states combined.
| Function | Spending | Share |
|---|---|---|
| Public welfare 36% in all states | $16.2B | 36.0% |
| Education 32% in all states | $14.2B | 31.6% |
| Other 9% in all states | $4.4B | 9.8% |
| Highways 6% in all states | $2.5B | 5.5% |
| Government administration 4% in all states | $2.3B | 5.1% |
| Public health 3% in all states | $1.9B | 4.3% |
| Prisons and corrections 2% in all states | $1.2B | 2.6% |
| Natural resources 1% in all states | $704.8M | 1.6% |
| Hospitals 5% in all states | $573.4M | 1.3% |
| Interest on debt 1% in all states | $482.7M | 1.1% |
| State police 1% in all states | $345.2M | 0.8% |
| Parks and recreation 0% in all states | $171.4M | 0.4% |
Per resident, rank and change for every function
| Function | Tennessee per resident | All states per resident | Rank (1 = most) | Change since 2022 |
|---|---|---|---|---|
| Education | $1,982 | $2,787 | 48 of 50 | +6% |
| Public welfare | $2,264 | $3,193 | 38 of 50 | +7% |
| Hospitals | $80 | $408 | 39 of 50 | +19% |
| Public health | $272 | $288 | 21 of 50 | -1% |
| Highways | $345 | $534 | 49 of 50 | +16% |
| State police | $48 | $74 | 44 of 50 | +3% |
| Prisons and corrections | $163 | $197 | 35 of 50 | +12% |
| Natural resources | $99 | $112 | 29 of 50 | +16% |
| Parks and recreation | $24 | $29 | 33 of 50 | +13% |
| Government administration | $323 | $321 | 32 of 50 | +42% |
| Interest on debt | $67 | $109 | 34 of 50 | +102% |
| Other | $613 | $782 | 33 of 50 | +12% |
U.S. Census Bureau, Annual Survey of State Government Finances, 2023.
On your state tax bill
Your state taxes split in proportion to Tennessee's 2023 general spending. State spending is funded by taxes, federal funds and fees together, so this shows how a tax dollar divides, not which dollar pays for what.
| Goes to | Of $1,000 | Of $2,500 | Of $5,000 |
|---|---|---|---|
| Public welfare | $360 | $901 | $1,802 |
| Education | $316 | $789 | $1,578 |
| Other | $98 | $244 | $488 |
| Highways | $55 | $137 | $274 |
| Government administration | $51 | $129 | $257 |
| Everything else | $120 | $300 | $600 |
Where the money comes from
Tennessee collected $2.9 million in individual income tax in fiscal 2023, 0% of its tax revenue.
Federal funds are Tennessee's largest source of general revenue
State government general revenue by source, fiscal year 2023 (July 2022 to June 2023)
| Source | Revenue | Share |
|---|---|---|
| Federal funds | $20.2B | 41.8% |
| General sales tax | $13.8B | 28.6% |
| Selective sales taxes (fuel, tobacco, alcohol, insurance) | $3.8B | 7.9% |
| Corporate income tax | $3.2B | 6.5% |
| Licenses (vehicles, businesses, hunting) | $2.6B | 5.4% |
| Charges and fees (tuition, hospitals, tolls) | $2.5B | 5.2% |
| Interest, lottery and other | $1.8B | 3.7% |
| Other taxes (severance, estate and others) | $416.6M | 0.9% |
| Individual income tax | $2.9M | 0.0% |
U.S. Census Bureau, Annual Survey of State Government Finances, 2023.
Federal money and Tennessee
Federal taxes paid by Tennessee residents and businesses: how much federal tax Tennessee pays. Federal spending in the state: federal money in Tennessee. For federal taxes, see where your federal taxes go.
Questions and answers
- Where do my state taxes go in Tennessee?
- Of every dollar Tennessee's state government spent in fiscal year 2023 (July 2022 to June 2023), 36¢ went to public welfare, 32¢ to education and 10¢ to other purposes. Total general spending was $44.9 billion.
- How much does Tennessee spend per person?
- $6,282 per resident in fiscal 2023, 48th highest of the 50 states (all states together: $8,834).
- How much of Tennessee's budget comes from the federal government?
- 42% of general revenue ($20.2 billion) in fiscal 2023 came from the federal government, the largest part for Medicaid. By that share Tennessee ranks 13th of the 50 states (1st = most reliant). Taxes were 49%.
- Does Tennessee have a state income tax?
- Tennessee collected $2.9 million in individual income tax in fiscal 2023, 0% of its tax revenue.
- How much does Tennessee spend on education and Medicaid?
- Education $14.2 billion (32%) and public welfare, mostly Medicaid, $16.2 billion (36%) in fiscal 2023. Education spending includes aid to local school districts, which then add their own property-tax money.
- How much debt does Tennessee's state government have?
- $8.0 billion at the end of fiscal 2023, $1,117 per resident. Local governments' debt is separate.
Other states
- Arkansas$8,998 per resident
- Kentucky$9,815 per resident
- Mississippi$8,304 per resident
- North Carolina$7,282 per resident
- Alabama$7,982 per resident
- Indiana$7,491 per resident
Sources and notes
- U.S. Census Bureau, Annual Survey of State Government Finances, "ASFIN State Totals" tables for 2022 and 2023 (Last Revised: September 16, 2025). Thousands of dollars in the source. Public domain.
- General expenditure is the state government's spending excluding its utilities, liquor stores and insurance trust funds (state employee pensions and unemployment benefits). It includes aid passed to local governments.
- Fiscal years end on 30 June in 46 states; New York (31 March), Texas (31 August), and Alabama and Michigan (30 September) differ.
- Population: U.S. Census Bureau, Vintage 2025 estimates, July 2023.