Taxes

Lawmakers propose scrapping data center tax breaks

One said the facilities sprouting up across the country are ‘universally opposed by the people.’
Mike Petak of Spring City gestures while speaking to East Vincent Township supervisors in opposition to a data center proposal at the former Pennhurst state hospital grounds, Dec. 17, 2025, in Spring City, Pa. (AP Photo/Marc Levy)

Lawmakers in at least four states — Arizona, Michigan, Virginia and Washington — are pushing for legislation that would end sales tax breaks for data centers, a sign of the growing backlash to so-called hyperscale facilities under construction across the country.

Supporters say massive facilities financed by wealthy tech companies don’t need a tax discount. They argue that data centers drive up electricity prices and harm the environment while adding few permanent jobs. 

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