Six Reasons Why Moving to Texas Could be Right for Your Business
According to the U.S. Census Bureau, Texas grew at a rate of approximately 1,000 people per day in 2019. Of these new Texans, roughly half are born here and half migrate from other states or countries. But people aren’t the only ones moving to Texas. Companies are, too. Just in the last few months, Oracle moved its headquarters from Redwood City, CA to Austin. Hewlett Packard Enterprise is now headquartered in Houston, leaving San Jose. And Elon Musk now calls Austin home, as will some 5,000 workers to be employed at Tesla’s largest auto assembly plant currently under construction in Travis County. But Texas isn’t only for the Oracles, HPEs and Teslas of the world. Smaller companies are coming to the Lone Star State, too. Read on to learn why moving to Texas could be right for your business.
No Corporate Income Tax
One of the well-known benefits of having a company in Texas is that the state does not impose a corporate income tax. Texas calls its tax on business a franchise tax, which is basically a fee that a company pays in order to do business in the state. The franchise tax does not apply to profit, whereas income tax does.
Furthermore, businesses with receipts less than $1.8 million pay no franchise tax. Annual receipts between $1.18 million and $10 million pay a franchise tax of 0.575 percent, and the maximum in Texas is one percent. This can make a big difference for small businesses, allowing them to keep more of the money they make.
Favorable Regulatory Conditions and Funding
Texas is known for not getting in the way of business growth. Regulations are reasonable, straightforward and predictable. This lack of “red tape” makes it easier for a new or established company to thrive. Furthermore, Texas offers a number of competitive incentives to companies that will create jobs as well as support innovation in Texas. And that’s just at the state level—local incentives and tax abatements are also available.
Access to Global Markets
Location, location, location. Texas is centrally located within the continental United States and is crisscrossed with major highways, interstates and railroads. The state also has 14 international airports, and five of Texas’ maritime ports are ranked in the top 20 U.S. ports by total tonnage. So, whether your company needs to get product across the state, country or globe, Texas offers easy access.
No Personal Income Tax
For companies that need to recruit top talent, being able to say, “There’s no personal income tax in Texas,” is certainly advantageous. Millennials working at startups, for example, can use the additional money in their paychecks to pay off college debt or save for the down payment on a home. In particular, people that move for jobs in Texas from high income tax states such as California and New York, get a raise just from the lack of individual income tax.
Recruit Right Here
Texas has one of the largest, most hard-working and highly educated workforces in the country. Major universities are located throughout the state: the University of Texas at Austin, Rice University in Houston, Southern Methodist in Dallas, Baylor in Waco, Texas Tech in Lubbock and Texas A&M in College Station. There are also community colleges in cities large and small. Whether your company needs a software engineer, an accountant, a doctor, an office manager, a lawyer, a salesperson, an architect, a marketing director—whatever—chances are the right hire is already in Texas.
Quality of Life
Did we mention no personal income tax? Yep, okay then there’s also the comparatively low cost of living, a vibrant and diverse cultural scene, loads of indoor and outdoor recreational activities, music, sports, theaters, museums and restaurants to satisfy any craving.
If that’s not enough, consider this—the name Texas comes from the native American (Caddo) word teyshas, which means friends, and the official state motto is friendship. Friendly is practically in every Texan’s DNA. So what are you waiting for? Find a professional and friendly commercial real estate professional to help you determine if a move to Texas is right for your business.