Gordon Ramsay, the fiery, ill-tempered, and often profane British chef best known for his TV shows Hell’s Kitchen and MasterChef, is moving his company’s headquarters from California to Texas. The company he founded in 1997 plans to open more than 75 new restaurants over the next five years, and the Lone Star State’s business environment is more suitable for those plans.
Much more suitable.
As the Dallas Morning News reported:
[Ramsay] believes Dallas is the best place to find chef and restaurant support talent.
Gordon Ramsay North America has a temporary test kitchen inside Dallas College’s Culinary, Pastry and Hospitality facility in North Dallas — a place turning out chefs who are trained to work in fine dining restaurants and are likely looking for work.
In other words, if you can’t find the talent you need, you train them.
But the decision involved more than just finding good people to grow with the company. It’s finding a business- and tax-friendly place as well. And Texas won that contest going away. Said Norman Abdallah, Ramsay’s No. 1 man in Las Colinas, a high-end residential community inside Irving, Texas: “The cost-of-living adjustment [from California to Texas] is pretty substantial.”
Just how substantial? A massive survey of all 50 states by how “friendly” they are to small businesses by Thumbtack, a home-management website, revealed there was no contest. When parameters such as how easy it is to start a business, with taxes, licensing and other regulations factored in, Texas earned an “A” while California merited a “D.”
The Tax Foundation went further. In California, the top individual income tax rate is 13.3 percent. In Texas, it’s zero, as the state doesn’t have an individual income tax.
In California, the per-capita (per person) state and local income tax burden is $2,137. Again, in Texas, it’s zero.
In California, the state and local tax burden (including sales and property taxes) works out to be 11 percent of an average citizen’s paycheck. In Texas, it’s 7.6 percent. Thank you, Texas.
Others have preceded Ramsay’s move from California to Texas, including Elon Musk, who has officially moved Tesla’s headquarters from California’s Silicon Valley to a large factory being built outside Austin, Texas. Others making the same move include Toyota Motor North America, McKesson Corporation, Charles Schwab & Company, CBRE (Coldwell Banker Richard Ellis), Core-Mark International, Oracle, and Hewlett-Packard.
According to the Hoover Institute, 74 companies have moved out of California during the first six months of 2021 while only 62 companies moved into the state in all of 2020. The Institute also reported that from January 2018 through June 2021, a total of 265 companies left the Golden State, and 114 of them moved to Texas.
Ramsay’s president says the move is about finding great talent to manage his planned explosive growth. But each one he finds will also be pleased to make that friendly “cost of living adjustment” from California to Texas as well.
