State-Shared Taxes and Appropriations for the Coming Fiscal Year

Reference Number: MTAS-545
Tennessee Code Annotated
Reviewed Date: April 09, 2019
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The Tennessee Department of Revenue makes payments of state-shared revenues to all Tennessee municipalities based on population. MTAS tracks the monthly revenues reported by the Department of Revenue and uses those along with estimates to forecast what cities may expect to receive in the coming fiscal year.

The first column in the chart below shows an updated estimate for the 2018-19 fiscal year ($138.40). The second column takes what is estimated through June, uses available market data for 2019-20 and the increase in gas and motor fuel taxes generated by the IMPROVE Act and makes a conservative estimate of state-shared revenues for the 2019-20 fiscal year ($141.80). This estimate is preliminary, especially since only eight months of actual data are available at this time. This is to be used as a tool in estimating projected revenue for the 2019-20 fiscal year. It is but one tool, and a multi-year trend analysis should also be prepared to assist in determining the appropriate estimate for the FY 2019-20 budget.

NOTE** The IMPROVE Act of 2017 provided for additional gas and motor taxes. For FY 2019-20 the Act provides for an additional 1 cent of gas tax and 3 cents of diesel tax. Through November 2018 state sales tax shows a state-wide increase of slightly more than 6 percent over the prior year. State beer tax, the special petroleum tax and the TVA in-lieu-of tax remain essentially unchanged. Gasoline and motor fuel taxes have increased about 6.8% percent over the prior year due primarily to the IMPROVE Act. MTAS will review monthly actual revenue and will update the estimate if it changes significantly.

  Updated Estimate 2018-2019 Initial Estimate 2019- 2020
General Fund Per Capita Amount Per Capita Amount
State Sales Tax $88.00 $89.00
State Beer Tax .50 .50

Special Petroleum Products Tax
(City Streets and Transportation Revenue)

2.00 2.00
Gross Receipts Tax
(TVA in lieu of taxes)
11.90 11.80
Total General Fund Revenue $102.40 $103.30
     
State Street Aid Funds    
Gasoline and Motor Fuel Taxes $36.00 $38.50
     
Total Per Capita (General and State Street Aid Funds) $138.40 $141.80