Tenn. Code Ann. § 67-4-1108: Distribution of revenue

All revenues collected from each taxpayer under this part shall be allocated in the following manner:

(1) Two percent (2%) of the tax collected from each taxpayer shall be retained by the department and credited to its current service revenue to cover the expenses of administration and collection of the tax and penalties and interest on the tax; and

(2) The remainder shall be remitted to the county and municipality designated on the return filed together with the tax payment, pursuant to § 67-4-1106 , or, if the taxpayer fails to follow this part, the county or municipality that would have been so designated had the taxpayer acted according to this part.