Texas Economy

There has been so much press of late about the economy in Texas, and how cities in that state are the cities to be in. I thought I would take a look at them, seeing as, I myself will soon be living there.

The Lone Star State is known for the do-it-yourself gumption that goes along with cowboys and wide open spaces -- and low taxes are part of the package. The Texas Constitution actually forbids an income tax.

"The state has made a concerted effort not to be stringent," says R.J. DeSilva, spokesman for the Texas Controller's Office. "The spirit of entrepreneurship is inherent in the Texas business community."
- CNN Money

In addition the same article says that Texas, specifically, McAllen, Killeen, Houston, Austin, Abilene, El Paso, Midland and Lubbock are among the best places to launch a new business.

While the Lone Star State has no corporate income tax, it does have what's called a "gross receipts" or "franchise" tax, charging businesses 0.5% of revenues if they are in retail and 1% of revenues for non-retail businesses. But small businesses are exempt from the franchise tax -- and to help companies weather the recession, the state legislature recently raised the revenue exemption level to $1 million, up from $300,000. The change will take effect in January 2010, according to DeSilva.
- CNN Money

According to the article, low taxes make the state fertile ground for starting and growing a new business.

Regarding the Texas economy, the campaign of Governor Rick Perry, had this to say,

While the nation remains in an economic slump, there are emerging signs of recovery in several Texas cities.

Eduardo Martinez, senior economist at Moody's Economy.com, praised Texas for its relative economic strength:

"In Texas, it was a relatively mild recession," says Martinez. "All our projections are for quite a bit of growth. In terms of job creation, more people are moving out there, and families are getting bigger. The fundamentals for Texas are a lot stronger than those of other peer large states."

Indeed, seven Texas metro areas [Austin-Round Rock, Brownsville-Harlingen, Dallas-Plano-Irving, El Paso, Lubbock, McAllen-Edinburg-Pharr and San Antonio] are reported by Moody's Economy to be among the first cities in the nation to emerge from recession.

Late last week, Forbes also named all four major Texas metropolitan areas (Dallas-Ft. Worth, Houston, Austin, and San Antonio) among its top 10 of "America's Recession-Proof Cities To Retire In."

For those looking for a reason why Texas is performing better than the nation as a whole, CNN Money named Texas the number 2 tax haven in the country. Texas has also been praised in recent days for our innovative and successful lawsuit reform.

So, if Texas was named the number two (2) tax haven by CNN Money, what state was number one? That distinction would be South Dakota. However, it is to cold for me up there, and that was never a state for me to consider. Although, it is beautiful up there. So how did they get the top spot? Like Texas, No personal or corporate income tax.

Forbes had a list of the top Recession-Proof Cities To Retire In.

These affordable metro areas offer sunny weather, plenty of seniors and rosy economic outlooks
- Forbes Magazine

Three (3) Texas cities were among the top 10 on the list. Those metro ares were Dallas-Fort Worth-Arlington (metro population 6.3 million) at number 2, Austin-Round Rock (metro population 1.7 million) which tied with St. Louis, Mo for the number 5 slot and San Antonio, TX (metro population 2 million) which came in at number 10.




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