Changes to Franchise Tax Nexus. The Comptroller's office has amended Rule 3.586, Margin: Nexus, for franchise tax reports due on or after Jan. 1, 2020. A foreign taxable entity with no physical presence in Texas now has nexus if, during any federal accounting period ending in 2019 or later, it has gross receipts from business done in Texas of $500,000 or more. For the 2020 report year, a passive entity as defined in Texas Tax Code Section 171.0003; an entity that has total annualized revenue less than or equal to the no tax due threshold of $1,180,000; an entity that has zero Texas gross receipts; an entity that is a Real Estate Investment Trust (REIT) meeting the qualifications specified in Texas Tax Code Section 171.0002(c)(4); or an entity that is a pre-qualified new veteran-owned business as defined in Texas Tax Code Section 171.0005 can file According to a recent report from the Texas Taxpayers and Research Association, in 2009, franchise tax revenue accounted for over 11 percent of all state taxes collected, but since that time the 11 percent share has steadily declined by almost half to 6.5 percent in 2017. Franchise tax as a percentage of gross state product also peaked in 2008 and 2009 at 0.36 percent (soon after the changes went into effect) but has since declined to almost half that amount at 0.19 percent in 2017.