What are the major expenditures of state governments? What are the major sources of tax revenue?

Education expenditures account for about 36 percent of all state spending. State expenditures on public welfare are next in relative weight, at about 35 percent of the total. States also spend heavily on health and hospitals (7 percent), highway maintenance and construction (6 percent), and public safety (4 percent). That leaves about 12 percent of all state spending for a variety of other purposes. Sales and excise taxes are the primary source of tax revenue for state governments. These taxes account for about 48 percent of all their tax revenue. State personal income tax rates, which are much lower than the federal rates, are the second most important source of state tax revenue. They bring in about 37 percent of total state tax revenue. Corporate income taxes and license fees account for most of the remainder of state tax revenue.