The Lone Star State continues to solidify its position as one of the most attractive jurisdictions for businesses in the United States. In 2025 alone, the Texas Legislature passed a number of bills that further demonstrate the state’s deliberate commitment to fostering a business-friendly environment.

As discussed in prior articles,[1][2] Texas has long focused on policies designed to encourage business formation, expansion, and investment. When viewed together—tax structure, regulatory framework, infrastructure investments, and cultural emphasis on predictability and growth—Texas has cultivated a reputation as a premier destination for businesses across industries.

This reputation is reinforced by the growing number of companies relocating their headquarters to Texas. In addition, the launch of “Y’all Street”—the Texas Stock Exchange[3]—signals a bold effort to challenge traditional financial centers by offering companies alternative listing venues. These developments reflect Texas’s broader strategy to position itself as a long-term hub for corporate activity.

Several key factors explain why, year after year, Texas remains at the top of the list for businesses.

1. Favorable Tax Climate

Texas has long avoided imposing a corporate or personal state income tax, positioning itself as a low-tax jurisdiction. This foundational tax structure provides businesses with meaningful cost advantages compared to high-tax states, allowing companies to retain more capital for reinvestment, expansion, and talent acquisition. The absence of a state income tax also benefits employees directly, making Texas especially attractive for corporate relocations and new business formations.

2. Lower Cost of Doing Business

Beyond taxes, Texas offers competitive operating costs across multiple dimensions. Commercial and residential real estate prices remain more affordable than in many major business hubs. Energy costs are competitive due to the state’s abundant natural resources and deregulated electricity market. Labor costs are generally reasonable relative to the depth and quality of the available workforce, providing businesses with strong value for their personnel investments.

3. Business-Friendly Regulatory Environment

Texas has consistently emphasized a regulatory approach that avoids unnecessary burdens on businesses while promoting stability and predictability.

Recent legislation reinforces this approach:

• Senate Bill 29 modernizes corporate governance by codifying the business judgment rule, reforming derivative proceedings, and streamlining the process for assessing corporate director independence.[4]
• House Bill 9 expands the business personal property tax exemption from approximately $2,500 to up to $125,000, significantly reducing tax exposure for small and midsized businesses.[5]
• House Bill 346 lowers costs and regulatory hurdles by adjusting fees and exemptions related to business record searches and filings.[6]
• Senate Bills 1057 and 2411 amend the Texas Business Organizations Code to optimize corporate governance. SB 1057 permits certain publicly traded or nationally listed corporations to impose higher ownership and support thresholds for shareholder proposals, limiting frivolous actions. SB 2411 streamlines corporate procedures, including ratification processes, officer liability provisions, and other governance mechanics.[7][8]
• Senate Bill 1058 amends the Texas franchise tax to exclude certain securities transaction-related payments such as “transaction rebate” payments, from the taxable revenue of stock exchanges.[9]

Together, these measures reflect Texas’s commitment to maintaining a predictable, efficient, and business-oriented legal framework.

4. Supportive Government Institutions

Texas has also developed institutional frameworks to support business operations and resolve disputes efficiently. The establishment of the Texas Business Court reflects an effort to provide faster resolution of complex business disputes and promote predictable outcomes grounded in established legal principles.[10]

Beyond the judiciary, agencies such as the Texas Economic Development Corporation[11] and the Office of the Governor[12] actively recruit businesses and offer resources to support new and expanding operations.

5. Strong and Diverse Economic Growth

Texas benefits from a highly diversified economy that includes energy, technology, healthcare, manufacturing, aerospace, and agriculture.[13] This diversity provides resilience against sector-specific downturns while creating opportunities for businesses across a wide range of industries.[14]

6. Workforce Availability and Quality

Texas boasts one of the largest and most diverse labor pools in the nation. The state remains committed to developing homegrown talent while continuing to attract workers through domestic migration and international immigration. This combination ensures businesses have access to a deep and adaptable workforce.

7. Infrastructure Investment

Texas has made sustained investments in infrastructure to support business growth. Ongoing expansion of transportation systems—including highways, ports, airports, and rail—combined with reliable access to utilities, reflects a long-term commitment to accommodating economic development and population growth.

8. Business Incentive Programs

Texas offers a range of incentive programs designed to attract and retain businesses, including:

• The Texas Enterprise Fund[15], which provides financial incentives for businesses making significant capital investments
• Skills Development Fund[16] grants to support workforce training
• Research and development tax credits[17]
• Property tax abatements[18] available through local jurisdictions

These programs demonstrate the state’s willingness to partner with businesses and provide tangible financial support.

Conclusion

Through smart policy choices, bold investments, and fresh legislative reforms, Texas keeps turning up the heat on its already sizzling pro‑business climate. Companies looking for stability, predictability, and wide‑open growth opportunities continue to find that Texas doesn’t just talk business – it  means business.

So if you haven’t relocated your company to the Lone Star State yet, what are you waiting for?  Texas is rolling out the red carpet straight to the boldest financial district in the nation: Y’all Street.

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[1] Shields Legal Group. Texas Reshapes Corporate Governance: What Businesses Need to Know About Senate Bill 29, https://shieldslegal.com/texas-reshapes-corporate-governance-what-businesses-need-to-know-about-senate-bill-29/.
[2] Shields Legal Group. A Deeper Dive Into Texas Senate Bill 1058: The Franchise Tax Exemption For Stock Exchanges, https://shieldslegal.com/a-deeper-dive-into-texas-senate-bill-1058-the-franchise-tax-exemption-for-stock-exchanges/.
[3] As of this article, the Texas Stock Exchange (TXSE) has received SEC approval.
[4] “Bill Analysis for Texas Senate Bill 29 (89th Legislature).” Texas Legislature Online, 6 Mar. 2025, https://capitol.texas.gov/tlodocs/89R/analysis/html/SB00029I.htm.
[5]  “Fiscal Note for HB 9 (89th Legislature).” Texas Legislature Online, Legislative Budget Board, 2 Mar. 2025, https://capitol.texas.gov/tlodocs/89R/fiscalnotes/html/HB00009I.htm.
[6] “Fiscal Note for HB 346 (89th Legislature, Regular Session).” Texas Legislature Online, Legislative Budget Board, 1 Apr. 2025, https://capitol.texas.gov/tlodocs/89R/fiscalnotes/html/HB00346I.htm
[7] “Bill Analysis for SB 1057 (89th Legislature).” Texas Legislature Online, Senate Research Center, 4 Mar. 2025, https://capitol.texas.gov/tlodocs/89R/analysis/html/SB01057I.htm.
[8] “Bill Analysis for SB 2411 (89th Legislature, Regular Session).” Texas Legislature Online, Senate Research Center, 29 Mar. 2025, https://capitol.texas.gov/tlodocs/89R/analysis/html/SB02411I.htm.
[9] Bill Analysis for Texas Senate Bill 1058 (89th Legislature).” Texas Legislature Online, Senate Research Center, 13 Mar. 2025, https://capitol.texas.gov/tlodocs/89R/analysis/html/SB01058I.htm.
[10] Texas Judicial Branch, Business Court, https://www.txcourts.gov/businesscourt/.
[11] Texas Economic Development Corporation,https://businessintexas.com/.
[12] Office of the Governor, Texas Jobs, https://gov.texas.gov/business/page/jobs.
[13] “Bigger. Better. Texas.” Economic Development Strategic Plan: 2025–2029. Office of the Governor — State of Texas, Page 6, Mar. 2025, gov.texas.gov/uploads/files/business/Bigger.Better_.Texas_.Economic_Development_Strategic_Plan.pdf.
[14] Id.
[15] Office of the Texas Governor. Texas Enterprise Fund. https://gov.texas.gov/business/page/texas-enterprise-fund.
[16] Office of the Texas Governor. Skills Development Fund. https://www.twc.texas.gov/programs/skills-development-fund.
[17] Texas Comptroller of Public Accounts. Sales tax exemption or franchise tax credit for qualified research. https://comptroller.texas.gov/taxes/qualified-research/.
[18] Texas Comptroller of Public Accounts. Property Tax Abatement Act (Chapter 312 overview). https://comptroller.texas.gov/economy/development/prop-tax/ch312/.