• New data from the Tennessee General Assembly’s Fiscal Review Committee confirms what many predicted: Annual corporate tax collections dropped by $721 million over the past year—down from $4.6 billion in FY2024 to just $3.8 billion in FY2025.
• The final state revenue report for Fiscal Year 2025, which ended June 30, showed a dramatic decrease in Franchise and Excise tax collections, representing a massive windfall for corporations—and a major loss of revenue for Tennessee’s schools, roads and public safety. In just one year, these corporate taxes dropped from making up 20.7% of all state tax collections to just 17.3%.
• This steep decline isn’t the result of shrinking government or declining need. Tennessee ranks near the bottom nationally in school funding, traffic congestion is worse than ever, and working families continue to struggle with the soaring costs of health care, housing, child care and higher education.
• So how did we get here? In back-to-back years, Gov. Bill Lee and the controlling Republican Party passed record corporate tax breaks. In 2024, they eliminated a key portion of the corporate franchise tax and handed out a $1.44 billion cash refund to 58,500 companies. The 2023 corporate tax changes were estimated to cost another $1.87 billion. Together, these two corporate giveaways were expected to drain an estimated $7.4 billion from the state budget over a decade—and now, after just one year of real-world data, it looks like the true cost could be even higher.
• Meanwhile, ThinkTennessee reports that Tennessee already has one of the lowest effective business tax rates in the country, and that working families pay a higher share of their income in taxes than wealthy corporations. Teachers, truck drivers, and construction workers are now footing the bill while billion-dollar companies and CEOs skate by paying less.
• This is trickle-down economics in action—and it’s leaving our communities underfunded, underserved and increasingly unequal. The math doesn’t lie. Tennessee Republicans are working for billionaires — not working families.
Tennessee employers shed 900 jobs in July, breaking six-month stretch of job gains
Aug. 14 – Tennessee Economic Analysis – TN Labor Department
• Employers in Tennessee shed 900 jobs from June to July, breaking a six-month stretch of job gains in the Volunteer State, according to seasonally adjusted non-farm employment numbers released last week by the state Labor Department. The department also revised June’s adjusted nonfarm employment numbers down from 6,100 new jobs to only 1,500.
• A state jobs report showing a loss of 900 jobs probably won’t set off alarm bells, but there’s no doubt Tennessee’s Republican policymakers would rather see net job gains.
• The slowdown in hiring could be another indication that Tennessee businesses are feeling the consequences of President Donald Trump’s new tariff taxes and mass deportation machine.
• The data also shows Tennessee’s unemployment rate ticked up a tenth of point to 3.6% in July.
Brandon J. Puttbrese
The Office of Senator London Lamar
Cordell Hull Office Building, Suite 762