Doing Business in Texas: Why Choose Texas?
Updated May 18, 2022
Doug McCullough, McCullough Sudan, PLLC, Partner
Texas has an economy roughly the size of the nation of France or Canada. We also enjoy diverse resources such as oil and gas and vast tracts of land, highly skilled (and friendly!) workers, and have diverse industries ranging from energy, healthcare, aerospace, telecommunications, private equity, semiconductors, and software. It’s no wonder that so many out-of-state companies have moved facilities and even headquarters to Texas from states with a heavier tax and regulatory burden.
For instance, Elon Musk recently opened the Gigafactory in Austin, Texas where Tesla will be manufacturing EV trucks. In recent years, companies like Toyota, HP, Oracle and ExxonMobil, have moved headquarters and/or operations to Texas.
Companies are moving to Texas because of the relatively light regulatory burden, and the lower costs of living and doing business. Texas regularly claims a top spot in various rankings for ease of doing business. The state has a reputation of being business-friendly, with minimal state taxes and reasonable regulations. With no corporate or personal income tax at the state level, companies operating in Texas enjoy one of the lowest overall tax burdens in the country. Also, the cost of living in Texas is lower than states like California and New York (which have seen recent net outbound migrations of residents). Because of the lower cost of living and available affordable housing, many families are also moving to Texas. This provides Texas companies with a growing talent pool.
While Austin gets a lot of national attention for attracting tech companies, Texas offers several other major metropolitan areas including Houston, Dallas, Fort Worth and San Antonio. People from outside Texas may be surprised to learn that Houston is considered the most diverse city in the United States.
To learn more, enjoy our next installment in this series: Doing Business in Texas: Getting Started.
About the Author: Doug McCullough is a partner in McCullough Sudan, PLLC. He is licensed in Texas and New York, and has a master’s of law in taxation from Southern Methodist University School of Law. He regularly assists companies with international business, tax planning, and mergers & acquisitions. He is a director of the Canada-Texas Chamber of Commerce, a GlobalScot, and member of the British American Business Council. Email: email@example.com.