Politics
Chattanooga Keeps Property Tax Rates Below Knoxville and Memphis Levels
Chattanooga residents will see property tax bills calculated under the city's adopted fiscal framework, which applies rates lower than those reported by Knoxville and Memphis in their most recent budget filings.
How we reported this
The Chattanooga city council approved its 2026 operating budget on June 30, applying a property tax rate of $2.48 per $100 of assessed value. This figure places the city below the rates used by several other Tennessee municipalities under the same state budget reporting rules.
State Requirements Drive Comparisons
Tennessee law requires each city to file its tax levy and expenditure plan with the state comptroller by July 1 each year. The filings allow direct comparison of how different jurisdictions set rates and allocate revenue. Chattanooga's submission covers the general fund, which pays for police, fire protection and street maintenance.
Local residents pay these taxes through annual bills mailed by Hamilton County. A homeowner whose property is assessed at $200,000 will owe $4,960 under the new rate. The same assessment in Knoxville produces a higher bill because that city uses a rate of $2.71 per $100.
Service Funding and Household Costs
The budget document shows that 42 percent of the general fund goes to public safety. The remainder supports parks, libraries and sanitation. Because the tax rate is lower than in peer cities, the city projects that it will collect $187 million in property taxes, an amount it states will cover current service levels without new debt.
City staff have said the lower rate results from higher-than-expected sales tax collections last year. The government projects that revenue will remain steady through the end of 2026. Residents who itemize deductions on federal returns can subtract the local tax payments when calculating taxable income.
The next required step is the county's tax collection cycle, which begins in October. Hamilton County will send bills based on the city rate and will forward the revenue to Chattanooga within 30 days of receipt. The city will publish a mid-year budget update in January 2027 that shows actual collections against the projections.