Tennessee has long been one of the economically freest states, largely due to its fiscal policies, but it also used to be one of the personally freest states in the South. No longer is that true. The Volunteer State lacks an income tax, and both state and local tax collections fall below the national average. Tennessee is the number two state for labor-market freedom, with a right-to-work law, no minimum wage, relaxed workers’ comp rules, no E-Verify mandate, and federally consistent anti-discrimination law. Tennessee’s land-use regulations are flexible, and it has a regulatory takings law. However, eminent domain reform has not gone far.
Other than on sales taxes and price gouging, where Tennessee gets hit the most is personal freedoms. Criminal justice policies have deteriorated over time. The crime-adjusted incarceration rate is still slightly below the national average but has risen since 2000. Drug arrest rates are now well above the national average. Asset forfeiture is mostly unreformed and cannabis laws are very strict. Tennessee is one of the best states for gun rights, but the rules for open carry are fairly strict. Alcohol freedom is below average because of the blue laws and very high beer taxes, which were raised in 2013–14 to $1.06 a gallon in 2008 dollars. The state has little gambling and educational freedom is low: private school choice programs are nonexistent, and private schools and homeschools face significant regulatory burdens.