A torrent of states are repealing data center tax exemptions — but it could increase costs by upwards of 7%
- Multiple US states are repealing or enacting moratoriums on sales tax exemptions for data centers
- Estimates on lost tax revenue are far below the billions of dollars some states have missed out on
- Ongoing data center constructions may not be subject, but costs are expected to increase for new or planned projects
In a blow to US firms trying to expand AI compute capacity by building more data centers, multiple states are now repealing tax exemptions for equipment costs.
According to exclusive The Information reporting, the estimated costs could rise by upwards of 7%, as the exemptions previously allowed data centers to be kitted out with equipment without having to pay sales tax.
But as soon as Ohio Governor Mike DeWine revealed that the lost tax revenue amounted to $1.6 billion, instead of the projected $136 million, other states have started following suit.
States repeal data center tax exemptions
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