Governor Told Fiscal-Cliff Fall Will Hurt Tennessee Badly
NASHVILLE, Tenn. (AP) — A tax expert is warning state officials that Tennessee will be among the hardest-hit states if federal officials don't resolve the so-called fiscal cliff.
The Chattanooga Times Free Press reports Dr. Stan Chervin updated Gov. Bill Haslam and other state officials yesterday, saying states that depend heavily on sales taxes for revenue would feel the most stress if tax breaks are not extended.
Chervin is a senior research consultant with the Tennessee Advisory Commission on Intergovernmental Relations.
He notes that about 54 cents of each tax dollar in Tennessee comes from the state sales tax. Tennessee has no broad-based income tax, like most other states do.
Chervin says if automatic tax hikes take effect in January, people will spend less and sales tax collections will fall.