Texas has become one of the top destinations for businesses relocating from other states. With no state income tax, a business-friendly regulatory environment, a large workforce, and aggressive economic development programs, Texas offers a compelling case for relocation. This guide covers the real incentive programs available to businesses considering a move to Texas.
Why Businesses Relocate to Texas
Before examining specific programs, here are the structural advantages that make Texas attractive for business relocation:
- No state income tax: Texas is one of a handful of states with no personal or corporate income tax.
- Large labor market: Texas has the second-largest workforce in the country.
- Lower cost of living: Compared to California, New York, and other high-cost states, Texas offers lower housing and operating costs in most markets.
- Central location: Texas provides logistics advantages with access to major ports, interstate highways, and international trade corridors.
State-Level Relocation Incentives
Texas Enterprise Fund (TEF)
The TEF is the state's largest deal-closing fund. It provides direct financial incentives to businesses relocating or expanding in Texas when the state is competing against other locations. TEF deals typically involve commitments to create a specific number of jobs and make capital investments. While TEF is most commonly used for larger corporate relocations, it demonstrates the state's willingness to compete for business.
Texas Enterprise Zone Program
Businesses relocating to designated Enterprise Zones can qualify for state sales and use tax refunds on equipment and building materials. Refunds are tied to job creation — up to $2,500 per new job created within the zone. For businesses making significant equipment and facility investments as part of a relocation, this can provide meaningful savings.
Skills Development Fund
Relocating businesses that need to hire and train a new Texas workforce can access the TWC Skills Development Fund. The program provides grants for customized training delivered through community college partnerships — allowing relocating companies to train new Texas employees at reduced cost. See our workforce training grants guide.
Local Relocation Incentives
Chapter 380/381 Agreements
Texas cities (under Chapter 380) and counties (under Chapter 381) can negotiate economic development agreements with relocating businesses. These agreements can include:
- Cash grants tied to job creation and capital investment
- Property tax rebates for a period of years
- Fee waivers for permits, impact fees, and utility connections
- Infrastructure improvements (roads, utilities, site prep)
- Land donations or discounted land sales
The specific terms depend on the size of the relocation, the number of jobs created, and the competitive landscape. Contact the economic development office in your target Texas city or county to start the conversation.
Property Tax Abatements
Cities and counties can offer property tax abatements of up to 100% on new improvements for up to 10 years. For businesses constructing or renovating facilities as part of a relocation, this can significantly reduce operating costs in the early years.
Tax Increment Reinvestment Zones (TIRZ)
Relocating to a TIRZ area can provide access to improved infrastructure, development incentives, and in some cases direct financial support funded by incremental tax revenue generated within the zone.
Federal Programs Available After Relocation
- Opportunity Zones: Businesses relocating to designated Opportunity Zones can attract investors who receive capital gains tax benefits.
- New Markets Tax Credits: Businesses in low-income census tracts can access favorable financing through NMTC-funded Community Development Entities.
- WOTC: Businesses hiring Texas workers from eligible target groups can claim tax credits of $2,400 to $9,600 per qualifying hire.
Industry-Specific Relocation Advantages
- Manufacturing: Texas offers some of the strongest manufacturing incentives in the country, including TEF, property tax abatements, and Skills Development Fund. See our manufacturing grants guide.
- Energy: Texas leads the nation in energy production and offers extensive energy industry incentives. See our energy incentives guide.
- Technology: Austin, Dallas, Houston, and San Antonio all have growing tech ecosystems with local incentive programs.
How to Approach a Texas Relocation
- Contact target city economic development offices: Local incentives are often the most valuable and are negotiated based on your specific project.
- Engage the Governor's Office of Economic Development: For larger relocations, the state's economic development team can coordinate state-level incentives.
- Evaluate Enterprise Zone and Opportunity Zone locations: Strategic site selection can maximize available incentives.
- Plan workforce training early: Skills Development Fund partnerships take time to establish — start the process before relocating.
- Layer incentives: Texas businesses can typically stack state, local, and federal programs for maximum benefit.
Find Programs That May Fit Your Relocation
Businesses considering a Texas relocation may be eligible for a comprehensive package of state, local, and federal incentives.
Not sure which programs may fit your business? Our free screening report checks your business against 150+ verified programs — grants, tax credits, loans, and incentives — and shows you which ones may match. Start your free screening →