Legally Sound | Smart Business

Through a five-round championship bout, Matt travels to Texas from California to determine which state is better for business. Will it be a knockout with a clear winner or will it go to the scorecards? Round 1: Taxes Franchise Tax The California Franchise Tax Board has a reputation of being like the mafia in its aggressive collection tactics. Texas has its own franchise tax assessed by the state comptroller's office and is described as a "privilege tax imposed on each taxable entity formed or organized in Texas or doing business in Texas." Unlike California that has a minimum franchise tax of $800 per year per entity, Texas generally only collects from entities that meet minimum revenue thresholds which is currently $1,130,000. State Income Taxes Texas is among nine states in the United States with no income tax compared to California's progressive tax rates ranging from 1 to 12.3% for the highest income earners. Property Taxes California property tax is relatively reasonable with a combi