Texas becoming a hotspot for startups

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Entrepreneurs are ditching Silicon Valley and heading south to Texas instead to launch their startups, according to a congressman from the Lone Star State.

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Rep. Roger Williams, R-Texas, told FOX Business’ Maria Bartiromo Thursday that the Texas is seeing an influx of new companies recently.

Among the reasons for the influx is an absence of personal income and corporate income taxes.

“We’re seeing a lot of job growth and a lot of startup companies and it’s being fueled in many cases by energy but also by the opportunity of no personal income tax. [It’s] a very business friendly state and it wants businesses to come and start up,” Williams said.

Texas has long been known as a popular business-friendly state. Austin, in particular, has been known as a mecca for startups because of the city’s ability to attract a lot of foreign students to colleges like the University of Texas at Austin. According to the 2016 Kauffman Growth Entrepreneurship Index, Austin grew its startups faster than every city except Washington, D.C., by more than 80% growth.

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And, according to Williams, that growth has continued. Some of the other big drivers, other than an absence of a personal income tax, is a low cost of living, which is significantly lower than other major metro areas such as New York, Boston and Chicago.

In addition the state’s absence of a personal income tax, it also imposes gross receipt taxes instead of corporate incomes taxes, which frees up more money for business owners to invest in other ventures.