Taxes & Incentives Overview
In Texas and the Austin region, we've formalized a friendly attitude into a business climate that is truly user friendly. The tax structure is fair, competitive, and designed to make companies feel welcome. Texas is one of only a handful of states with no individual income tax (a very attractive environment for transferring employees).
Taxation
Total state and local taxes averaged $4,744 per person in 2020, 16% less than the national average. Similarly, state and local taxes in Texas are low relative to income, amounting to $86 per $1,000 of personal income, compared to the national average of $95 per $1,000.
State & local taxes per capita 2020
Tax burden 2020
TEXAS | UNITED STATES | |
|---|---|---|
| State & local taxes per capita, total | $4,744 | $5,616 |
| Property | 2,216 | 1,810 |
| Sales & gross receipts | 2,224 | 1,964 |
| Individual income | 1,281 | |
| Corporate income | 183 | |
| Other | 304 | 378 |
| State & local taxes per $1,000 of personal income | 86 | 95 |
Source: U.S. Bureau of the Census, State & Local Government Finances.
Texas incentive opportunities
The State of Texas offers a variety of incentive programs designed to make capital more available for businesses looking to expand or locate in the state, as well as for companies already doing business in Texas. Committed to retaining its "business friendly" reputation, Texas stands ready to help businesses expand, and become globally competitive.
Throughout Central Texas, local governmental and economic development organizations work hand-in-hand to develop competitive incentive packages for qualified companies. Projects are generally reviewed on a case-by-case basis with consideration given to type of industry, number of employees, average wages, capital investment, financial strength, community involvement and other factors.
The region’s incentives available for investment and job creation are competitive with peer regions anywhere in the nation.
Texas is the Best State for Business for the 18th consecutive year. (Chief Executive, 4/26/22)
Texas ranks No. 1 in annual business climate survey of corporate site selection executives. (Site Selection, 11/1/21)
Texas is No. 4 in annual Top States for Doing Business ranking based on annual survey of site selection consultants. (Area Development, Q3/21)
Texas has the nation’s Best Corporate Tax Environment. (Area Development, Q3/21)
Texas has the nation’s No. 3 Best Business Climate. (Business Facilities, 7/27/21)
Texas is No. 4 on America’s Top States for Business ranking. (CNBC, 7/13/21)
Texas is No. 3 on Forbes’ annual Best States for Business ranking. (Forbes, 12/19/19)
Texas has the most entrepreneur-friendly policy environment and the best state tax system. (Small Business & Entrepreneurship Council, 5/6/19)