The Tax Brief real effective rates for 111+ countries — bi-weekly, free.
HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Arkansas VS COUNTRY B Tennessee

Side-by-side analysis of income tax, effective rates, and take-home pay for Arkansas and Tennessee in 2026.

Daniel · CountryTaxCalc Updated May 2026 Tax Comparison 2026
Calculate your take-home → See all comparisons →
OVERVIEW
Arkansas has progressive income tax rates from 2% to 3.9% (reduced from 4.4%), while Tennessee has no state income tax (0%). Moving to Tennessee saves $3,516/year on $100k income. Property taxes are nearly identical (AR 0.62% vs TN 0.67%). Both states have extremely high sales taxes (AR 9.46%, TN 9.55% highest). Overall, Tennessee offers significant tax savings. The AR-TN border sees migration to Memphis for jobs and zero income tax.
Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

💎
COUNTRY A
Arkansas
TAX RATE
2-3.9%
Progressive (Was 4.4%)

5 brackets, up to 3.9%

🎸
COUNTRY B
Tennessee
TAX RATE
0%
No Income Tax

Constitutional prohibition

TYPICAL ANNUAL DIFFERENCE
Moving from Tennessee → Arkansas at $100,000
$3,516

That's $293/month back in your pocket

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME
💎 AR TAX
🎸 TN TAX
SAVINGS
10-YEAR
$50,000
$1,566
$0
$1,566
$15,660
$100,000
$3,516
$0
$3,516
$35,160
$200,000
$7,416
$0
$7,416
$74,160
$500,000
$19,116
$0
$19,116
$191,160
💡

CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. This helps us provide free tax calculators and comparison tools. Learn more about our affiliate partnerships

Talk to a Real CPA

TaxHub

★ 4.8 verified reviews  ·  3,758 reviews

Moving from Arkansas to Tennessee? Multi-state returns are tricky—AR has income tax, TN doesn't. Get matched with a CPA who specializes in border state moves.

⚠ Not for simple single-state returns. Free filing is fine for straightforward W-2 situations.

Get Matched With a CPA →

Interested in reaching this audience? Advertise on CountryTaxCalc →

💎

Arkansas Pros & Cons

+ PROS
  • Lower property tax: 0.62% (vs TN 0.67%) saves $125-$500/year
  • Slightly lower sales tax: 9.46% (vs TN 9.55%) saves $9/year
  • Very cheap housing: Little Rock median $200k (vs Memphis $220k similar)
  • Natural beauty: Ozark Mountains, Hot Springs, Buffalo River
  • Walmart presence: Bentonville HQ, retail jobs
− CONS
  • Income tax: 2-3.9% costs $3,516 on $100k, $19,116 on $500k
  • Limited jobs: Little Rock 740K vs Memphis 1.3M metro
  • Worse schools: AR ranks #43 vs TN #32 in K-12 education
  • Brain drain: Young professionals leave for Dallas/Nashville
  • Slow economy: AR ranks #47 for economic opportunity
🎸

Tennessee Pros & Cons

+ PROS
  • Zero income tax: Save $3,516/year on $100k, $19,116 on $500k
  • Better jobs: Memphis 1.3M metro (vs Little Rock 740K), FedEx HQ
  • Better schools: TN ranks #32 vs AR #43 in K-12 education
  • No retirement tax: $0 on Social Security, pensions, withdrawals
  • Music heritage: Beale Street, Graceland, blues history
− CONS
  • Higher property tax: 0.67% (vs AR 0.62%) costs $125-$500 more/year
  • Highest sales tax: 9.55% (highest in US) vs AR 9.46% costs $9 more/year
  • Crime: Memphis has high violent crime rates
  • Hot/humid summers: 90°F+ regularly (similar to AR)
  • Population loss: Memphis declining population (vs AR stable)
FAQ

Frequently Asked Questions

How much will I save moving from Arkansas to Tennessee?

On $100,000 income, Tennessee saves $3,516/year in income tax (AR 3.9% top vs TN 0%). Property and sales taxes are nearly identical (both very high). Net savings: ~$3,516/year. Over 10 years: $35,160. However, Memphis has higher crime than Little Rock, and Memphis population is declining while Little Rock is stable. Choose TN for tax savings. Choose AR for safety/stability.

Why did Arkansas reduce income tax from 4.9% to 4.4%?

Arkansas enacted an aggressive rate-reduction schedule to compete with neighboring zero-tax states (TN, TX). The top rate fell from 4.9% to 4.4% in 2024, then to 3.9% in 2026 — achieving a rate once targeted for 2029. Despite the reduction, Arkansas still loses residents to TN due to zero income tax. At 3.9%, Arkansas is now more competitive than it has ever been.

Is there significant Arkansas to Tennessee migration?

Yes, moderate AR → TN migration. In 2023, 8,472 people moved AR → TN (vs 5,134 TN → AR), net gain of 3,338 for Tennessee. Migration drivers AR → TN: no income tax (save $3,516+ annually at $100K), better jobs (Memphis FedEx), better schools (#32 vs #43). Reverse migration (TN → AR) driven by: lower crime (Little Rock safer), natural beauty (Ozarks), Walmart jobs (Bentonville).

Little Rock vs Memphis: which city is better economically?

Memphis wins for taxes: no income tax (save $3,516 annually at $100K), larger job market (1.3M vs 740K), FedEx HQ. Little Rock wins for: lower crime, better quality of life, natural beauty (Ozarks proximity), stable population. Both have very high sales tax (9.46-9.55%). Choose Memphis for tax savings. Choose Little Rock for safety/quality of life.
From the brief
NL27%new 2027 rate, down from 30%
DK65.4kkr/mo threshold, cut from 78k
MT1940snon-dom regime unchanged since
The Tax Brief · Subscribe free

More like this, every two weeks.

Verified rates, real after-tax figures, plain English. Free.

Bi-weekly. No spam. Unsubscribe in one click.