Why Major US Companies are Moving to Texas?
Everyone loves the Lone Star State! However, recently there has been an even larger migration of major US companies moving their headquarters to major Texas cities. What is driving this change and why do companies find it beneficial to operate in Texas? Recently, Toyota (previously located in Southern California) announced the decision to move their headquarters to Dallas, TX. This move will transfer over 3,000 jobs from Southern California to Dallas. However, Toyota isn’t the only major US company to make this drastic change- other large companies include Wholefoods, DropBox, Athena Health, and Dell. So the question is, why is Texas so attractive to these large US corporations?
Marginal Franchise Text
Texas in general supports a pro-business environment through its tax system, government regulations, and infrastructure. A huge part of this pro-business environment is their implementation of coporate tax laws which has remained as a huge incentive for companies to locate or expand in Texas. Texas currently has margins for franchises. Originally businesses with less than $434,782 in receipts were exempted, now set at $1 million. Also, Ccmpanies owning less than $1,000 are exempt. In addition, businesses with less than $10,000 in total revenues may opt for a simplified “EZ
calculation” based on gross receipts. Due to its pro business environment, it is not surprising that Texas has accounted for 33 percent of the nation’s job gains over the past 10 years. Texas’ pro-business environment has encouraged a large growth in energy, advanced manufacturing, aerospace, defense, biotechnologies, and IT industries.
No Personal Income Tax
In addition to not having corporate taxes, Texas also has no personal income tax. Having no personal income tax means more money in workers’ pockets every month. Because people’s income isn’t being directly taxed, worker’s take home more money each month and are therefore more likely to spend. For many Texas citizens, the lack of personal income tax is beneficial for their saving plans and financial planning. Because Texas doesn’t tax income, the state has to find alternative ways to make revenue. Instead of taxing personal income, Texas instead funds itself through a higher than average sales tax, motor vehicle tax, and taxes on oil and natural gas production.
Due to its laws, regulations, and government infrastructure Texas is attracting business of all sizes and types. This means more jobs for current residents and a rise in the number of educated workers. For all of these reasons and more, Texas is an attractive place to live for the young, talented, and educated!