More Tennesseans Forced To Declare Bankruptcy Amid Republican Reluctance To Pass Laws Providing Tax Relief

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Tennessee Conservative News [By Paula Gomes] –

A new study reports that more Tennesseans are filing for personal bankruptcy since last year. The news comes after reluctance by the Republican supermajority this legislative session to pass meaningful laws that could provide tax relief.

According to SmartAsset, Tennessee, long known for being part of the “Bible belt,” is one of four states forming a “bankruptcy belt” in the South. Tennessee ranked third for per capita personal bankruptcy filings nationally along with Georgia, ranked fifth; Mississippi, ranked second; and Alabama which ranks first in the nation.

Tennessee saw a total of 21,630 filings in a 12 month period ending March 31st, 2026, up from 20,296 since the previous year. The increase of 6.6 percent equates to almost 300 filings per 100,000 residents. While the state is in the number 3 spot nationally because of high filing rates relative to overall population, it ranks 41st out of all states for year-over-year growth in filings.

SmartAsset notes that having to file bankruptcy can lead to depression as well as other negative health outcomes.

Financial challenges are also affecting the agricultural sector around the country. The American Farm Bureau Federation reports that Chapter 12 farm bankruptcy filings reached the second consecutive annual increase last year, a total of 315 nationwide, the highest total reported in the last four years.

At the end of last month, Conservative Tennessee Representative and gubernatorial hopeful Monty Fritts (R-Kingston-District 32) called for an immediate suspension of state sales tax on gasoline, diesel fuel and groceries to relieve the ever growing financial burden on Tennesseans.

Pointing to “military action against Iran” as the impetus of the rising costs, Fritts said that what was initially thought to be “short-term after effects” can no longer be ignored as working families are struggling to pay for what they need. 

With the “extreme increase in gas and diesel prices” affecting the price of other necessities, Fritts says that Tennesseans on a fixed income — those on Social Security, Disability, and Veterans — have been especially hard-hit. Farming families as well are facing increased stress because of rising costs, likely adding to loss of agricultural land as farmers are unable to make their farms profitable. 

In a letter to addressed to Tennessee House Speaker Cameron Sexton, the Lieutenant Governor and General Assembly members, Fritts pointed to tax revenue collection reports recently sent to members of the General Assembly by the Department of Finance and Administration and their own Fiscal Review Committee. Both reports showed a “significant over collection of revenues,” implying that the State can afford to cut Tennessee residents a break on taxes.

Despite promises from Republican leaders in the Tennessee General Assembly last year to address the issue of sales tax, not a single proposed bill which would have reduced or eliminated the grocery tax from all foods, or even certain foods, even made it to the House or Senate floor during the 2026 legislative session.

One bill, which Governor Bill Lee recently signed and which takes effect immediately, allows counties with a metropolitan form of government to lower or exempt food from local sales tax. Applying to exactly three areas in the state: Nashville-Davidson, Memphis-Shelby, and Hartsville-Trousdale, the legislation will not impact the majority of Tennessee consumers.

All remaining bills were sidelined or ultimately killed as they were never heard in the finance committees and bills from this year cannot be carried over to next year as 2026 was the second year of the two-year 114th General Assembly.

About the Author: Paula Gomes is a Tennessee resident and reporter for The Tennessee Conservative. You can reach Paula at paula@tennesseeconservativenews.com.