Taxes & Incentives

Incentives Designed to Spur Success

In the Central Texas region already loaded with competitive advantages, taxes and incentives in Temple, Texas up the financial rewards. Companies contributing to Temple’s economic vitality through job creation, capital improvements and other investments gain an additional edge.

Known for one of the best enterprise funds in the nation, Texas has no personal, state or corporate income tax at the state level.

Local and state incentives are offered through tax abatements, refunds and rebates, loans, enterprise zones and Central Texas business grants. Employers may team with higher education institutions to fund training tailored for skills demanded by industry needs. Taxes on equipment, machinery, electricity and natural gas are offset for qualifying companies and purchases.

With costs 15% below the national average, Temple is one of the best values in the country when it comes to growing a business. Here are the incentives designed to boost your bottom line in Temple.

Sales Tax Rate

The State of Texas sales tax rate is 6.25%. Texas cities, counties, transit authorities, and special purpose districts have the option of imposing an additional local sales tax, for a combined total of state and local taxes of 8.25%. The Sales and Use Tax is imposed on all retail sales, including rentals and leases of most goods. The local sales tax rate in the City of Temple is 1.5% and Bell County is .5%.

State of Texas +

Bell County +

City of Temple +

= State & Local Taxes

Texas Enterprise Fund (TEF) Grant Offers | Temple

CompanyIndustryDirect JobsCapital
Investment
TEF Award
Offer
Date
Announced
Scott & White
Memorial
Health Care
Research
1,485$63,000,000
$7,500,000
2007
McLane Advanced
Technologies LLC
IT & LogisticsN/AN/A$500,0002009
East Penn
Manufacturing Co.
Lead Acid Battery
Manufacturing
253$106,650,000$1,290,3002018

Local Real Property Tax Rate

Per $100 Assessed Value

These are applicable taxes depending on the zone of the city you live in. Please contact us with your property of interested to get an exact amount.
EntityAmount
Temple ISD$1.4000
Belton ISD$1.6030
Troy ISD$1.2902
Academy ISD$1.3533
City of Temple$0.6772
Bell County$0.4212
County Road District$0.0299
Clearwater Underground Water District$0.00385
Temple College District$0.2047
Temple Health and Bioscience District$0.0195

Sales Tax Rate

JurisdictionSales Tax Rate
State of Texas6.25%
Bell County0.50%
City of Temple1.50%
State and Local Taxes8.25%

Sales Tax Revenue

City of Temple

For additional information, updated monthly by the City of Temple, click here.
MonthFY 15FY 16FY 17FY 18FY 19% Variance
Oct$3,489,994$1,857,540$1,782,147$1,889,493$1,917,5011.48%
Nov$1,566,784$1,524,999$1,562,275$1,698,713$1,876,18710.45%
Dec$1,430,286$1,514,737$1,642,007$1,721,105$1,786,8793.82%
Jan$2,213,612$2,260,144$2,214,514$2,215,777$2,233,2150.79%
Feb$1,457,610$1,418,289$1,558,862$1,563,720
Mar$1,421,812$1,792,732$1,663,682$1,603,658
Apr$1,826,749$1,997,512$2,013,932$2,115,654
May$1,486,686$1,536,106$1,599,119$1,663,248
June$1,461,142$1,583,839$2,081,701$1,670,814
July$1,880,703$2,076,129$2,080,101$2,116,194
Aug$1,567,111$1,611,072$1,736,904$1,748,973
Sept$1,509,256$1,685,981$1,717,281$1,824,277
PTD Total$8,700,675$7,157,420$7,200,942$7,525,087$7,813,7823.84%
YTD Total$21,311,743$20,859,081$21,652,524$21,831,626$7,813,782

Deal Closing

A corporate office building in Temple, TX

The Texas Enterprise Fund is the largest “deal closer” of its kind in the nation and supports new and existing businesses within state. Projects considered for the Fund must maximize the benefit to the State of Texas and realize a significant rate of return. Capital investment, job creation, wages generated, financial strength of the applicant, applicant’s business history, analysis of the relevant business sector, federal and local government, and private sector financial support of a project are factors. Award amounts range from $1,000 up to $10,000 per job created.

Enterprise Zone

Aerial view of train tracks and industrial area in Temple, TX

The City of Temple may nominate a limited number of projects each year for the Texas Enterprise Zone Program. Approved projects and businesses are eligible for a refund of state sales and use taxes paid and used at the qualified business site. Refunds are predicated on the total investment and number of jobs created or retained by the project, with a minimum of $2,500 per job to a maximum of $7,500 per job.

Exemptions & Refunds

A car drives into a corporate office park in Temple, TX

A number of exemptions and refunds exist for companies in Temple, Texas.

Tax Abatement
The City of Temple offers property tax abatement on real property and fixed improvements for up to 10 years based on primary job creation and investment. At a minimum, the project must increase the value of the property by $250,000 and create or retain a minimum of 25 new jobs. Applications should be submitted prior to the start of construction.

Economic Development Refund
The Texas Comptroller of Public Accounts offers a refund of state franchise and sales/use taxes paid by companies that own certain abated property.

Electricity and Natural Gas
Texas companies are exempt from paying state sales and use tax on electricity and natural gas used in manufacturing, processing or fabricating tangible personal property. A predominant use study completed by the company must show at least 50% of the electricity or natural gas consumed by the business directly causes a physical change to a product.

Equipment
Leased or purchased machinery, equipment, replacement parts and accessories that have a useful life of more than six months are exempt from state and local sales and use tax. This also applies to the equipment that is used or consumed in the manufacturing, processing, fabricating, or repairing of tangible personal property for ultimate sale. Texas businesses are exempt from paying state sales and use tax on labor for constructing new facilities or on the purchase of machinery exclusively used in processing, packing, or marketing agricultural products by the original producer at a location operated by the original producer.

Grants & Incentives

Aerial view of Temple, TX at night

The Temple Economic Development Corporation Board of Directors is authorized to investing corporation funds to help create primary jobs, increase the City’s tax base and other legally allowed activities. Approved companies may earn a loan, forgivable loan or reimbursement grant. Contact us for eligibility criteria, an application and details.

Chapter 380 Funds
Through the Texas Local Government Code, the City of Temple offers a range of incentives, including loans and grants, to promote economic development. Referred to as Chapter 380 Funds, it’s a mechanism for the city to refund or rebate their 1% portion of sales and use tax.

Training

A Workforce Solutions employee helps a person apply for a job using a laptop computer

The state-funded Skills Development Fund provides local customized training opportunities for Texas businesses and workers to increase skill levels and wages of the Texas workforce. A business, consortium of businesses, or trade union identifies a training need, and then partners with a public community or technical college to fill its specific needs. Benefits vary depending on the proposal.

Taxes

The Wyndam Hills neighborhood in West Temple, TX features a community swimming pool

Ranked the #1 corporate tax environment by Area Development in 2019, Texas offers a highly competitive business climate.

Local Real Property Tax Rate
Ad Valorem property taxes are based on the value of real property and tangible personal property. The City of Temple is in Bell County and either the Temple, Belton, Troy or Academy Independent School Districts. Depending upon the location of a specific piece of property, the levying jurisdictions will vary. All rates are per $100 of assessed value. Use the data provided on this page to determine the tax. Divide the assessed value of the property by 100 and multiply by the rate.

Sales Tax Rate
The State of Texas sales tax rate is 6.25%. Texas cities, counties, transit authorities and special purpose districts have the option of imposing an additional local sales tax for a combined total of state and local taxes of 8.25%. The sales and use tax is required on all retail sales, including rentals and leases of most goods. The sales tax rate in the City of Temple is 1.5% and Bell County is .5%.

Effective State Corporate Income Tax Rate
The State of Texas levies a margin tax on each taxable entity organized in Texas or doing business in Texas. Margin equals the lowest of three figures:

  • Total revenue less cost of goods sold
  • Total revenue less compensation
  • Or 70% of total revenue

The tax does not apply to sole proprietorships, general partnerships with individual owners, nonprofits or entities with $300,000 or less in gross receipts.

The rate per $1 million is:

  • 1.0% of margin for most taxable businesses
  • 0.5% for qualifying retailers and wholesalers
  • 0.575% for qualifying entities with $10 million or less in total revenue annualized per 12-month period

Unemployment Insurance Tax
In Texas, employers who are sole proprietorships, partnerships and corporations pay an Unemployment Insurance Tax to fund unemployment compensation for workers who lose their jobs. The tax is paid quarterly.

The first $9,000 employers pay each employee annually is taxable. Employers’ tax rate and the taxable wages they pay determine the amount they owe. New employers pay at a rate of 2.70%. Employers receive an experience rate after six calendar quarters. Their experience rate will vary depending on taxable wages reported and individual claims charged against their account.

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