Tennessee is one of those states that prides itself on not having an income tax. And I will say that in general, Tennessee has been a very good place for us to do business.
However, for entrepreneurs whose income is mostly derived from a self-owned company, the whole "no income tax" thing in Tennessee is misleading. In fact, I just had to prepare and pay 10 different quasi income tax submissions in TN -- the state Excise tax on businesses, the state Franchise tax on businesses, and county business tax in 8 counties. Some of these are not actually income taxes but are taxes as a percentage of revenue, but in some sense these are even worse than income taxes as they must be paid even if the company is losing money. Only California with its $800 minimum tax just for existing do we see a worse setup for a startup or money-losing entity.
In most states I pay state income tax based on my company's earning in that state (as an S-corp the corporate earnings pass through to my personal income taxes). But in TN, despite the fact it is not our largest state and supposedly has no income tax, I am going to end up with one of our highest state tax bills.