Taxes & Incentives
Local Incentives to Support Your Growth
Texas’ tax structure is different from most states. We do not collect an income tax at the state or local level. The main tax for businesses is property taxes, collected at the local level; sales and use taxes, collected at local and state level; and a franchise tax, collected at the state level. There are Midlothian local tax incentives and grant opportunities available for businesses looking to relocate or expand.
Property tax
Property Tax is applicable to the full-market value of real property (land and improvements) and personal property (machinery, equipment, inventory, vehicles, etc.). The property tax rate is based on $100 per taxable value.City – 0.65000School District – 1.2946County – 0.295867Total – 2.240467
Sales tax
Sales and Use Tax are applicable to qualifying goods and services. Sellers are responsible for collecting and remitting the correct amount of sales tax to the Texas Comptroller’s office.State – 6.25% City – 1.0% Midlothian Economic Development – 0.5% Midlothian Community Development Corporation 0.5% Total 8.25%
Franchise tax
Franchise Tax must be filed and paid by each taxable entity doing business in Texas. The Texas Comptroller provides detailed information on the tax, rates, and filing information that can be found on their website.Click to learn more.
Property Tax is applicable to the full-market value of real property (land and improvements) and personal property (machinery, equipment, inventory, vehicles, etc.). The property tax rate is based on $100 per taxable value.
- City – 0.65000
- School District – 1.1092
- County – 0.272532
Total – 2.031732
Sales and Use Tax are applicable to qualifying goods and services. Sellers are responsible for collecting and remitting the correct amount of sales tax to the Texas Comptroller’s office.
State – 6.25%
City – 1.0%
Midlothian Economic Development – 0.5%
Midlothian Community Development Corporation 0.5%
Total 8.25%
Franchise Tax must be filed and paid by each taxable entity doing business in Texas. The Texas Comptroller provides detailed information on the tax, rates and filing information that can be found on their website.
State & Local Tax Incentives
Midlothian Economic Development (“MED”) acts as a single point of contact for projects seeking to locate or expand in Midlothian. Each project will be evaluated by Midlothian Economic Development to determine the most appropriate organization to participate with your individual project.
Grants and Incentives
MED Downtown Catalyst Grant – In effort to implement Midlothian’s Downtown Plan, the MED has allocated funding to be used to implement infrastructure improvements associated with the seven catalyst projects. The catalyst projects include: (a) a new town square, (b) refining 8th street from Main Street to Avenue D, (c) Avenue F as a new “green street” spine, (d) Main Street as an asset, (e) adaptive reuse to activate 7th street, (f) carry back alley plaza northward, and (g) activate rail yard. Specific details on the catalyst projects can be found in the Downtown Plan. The funding is available for public and private investment. Interested applicants should review the MED Downtown Catalyst Funding Grant program guidelines.
MED/MCDC Grants – Midlothian Economic Development and Midlothian Community Development Corporation (“MCDC”) are two organizations that were created by Midlothian voters to grow our local economy. Midlothian Economic Development is a Type A corporation that receives 0.5% of all sales and use taxes generated in Midlothian. Midlothian Economic Development can use its funds to (1) recruit and retain primary job employers, (2) undertake certain job training programs, (3) pay for infrastructure improvements that promote new or expanded business enterprises, and (4) pay for capital improvements for career centers. The MCDC is a Type B corporation that also receives 0.5% of all sales and use taxes generated in Midlothian. The MCDC can use its fund for all Type A projects plus (1) projects related to recreational or community facilities, (2) affordable housing, (3) water supply facilities and conservation programs, and (4) sports venues with voter approval.
MDA Infrastructure Grants – Midlothian Development Authority (“MDA”) operates as a Tax Increment Reinvestment Zone (TIRZ) within a defined area at the RailPort Business park. The RailPort TIRZ was created in 1998 and is one of the most successful TIRZ in Texas. The Ad valorem tax revenue from the city, school district, and county are used by the TIRZ to fund public infrastructure projects that benefit the zone.
Tax Abatements – The City of Midlothian and Ellis County offer tax abatements in accordance with Chapter 312 of the Texas Tax Code. Tax abatements reduce the value of the new taxable property and thereby lower the overall ad valorem taxes paid by the company. Tax abatements are available on real and personal property. Each tax abatement is negotiated on a case-by-case basis. The city of Midlothian uses tax abatements to incentivize projects with a significant local impact and pay wages above the county average.
State Incentives – There are three main incentives that are applicable to projects seeking to relocate or expand in Midlothian, they include (1) the Texas Enterprise Fund which is a “deal-closing” fund used when Texas is competing with another state, (2) the Texas Enterprise Zone Program which provide grants for hiring workers from targeted areas, and (3) the Texas Data Center Exemption which exempts certain items from state and local sales tax.
Workforce Programs – Midlothian is served by two strong educational partners, Navarro College and Texas State Technical College North Texas. Each institution has extensive experience working with new and existing companies to apply for Skills Development Fund grants and other grants that provide free training for companies.
