Taxes

States reconsider data center tax breaks as costs soar, public opposition grows

Industry advocates say the benefits are an essential tool for economic growth.
Masayoshi Son, Chairman and CEO of SoftBank Group Corp., left, and Howard Lutnick, Secretary of Commerce speak at a groundbreaking for a new data center Friday, March 20, 2026, in Piketon, Ohio. (AP Photo/Joshua A. Bickel)

Virginia this week became the latest in a long list of states to reevaluate tax incentives for data centers, as public opposition to the facilities grows and the cost of such tax breaks skyrockets. 

Lawmakers in at least 11 states filed bills this year that would limit or end data center tax breaks. Governors in Washington and Alabama signed legislation scaling back incentives, and bills are still pending in Michigan, New Jersey, North Carolina and Pennsylvania

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