Over a decade ago, Ohio lawmakers exempted tech companies from sales taxes on computer servers and other equipment needed for data centers, betting that changes worth millions of dollars would lure much-needed investment to the state.
He represents parts of Cleveland, where locals have pushed back against the facilities, and he hopes the new threats force the companies to the negotiating table. Meta and Google declined to comment, as did DeWine’s office. President Trump has urged voters to welcome the facilities despite recent polls showing Americans overwhelmingly don’t want data centers near them. “If you want to go through poverty, crime, and squalor, I would say don’t approve data centers. Federal tax changes have also improved the economics of the data center build-out. And future centers may be able to use the Opportunity Zone program, which will soon offer enhanced tax breaks for certain rural investments.
Amazon said it has invested nearly $40 billion in Ohio data centers since 2015, creating thousands of jobs, and paid almost $11 million in state property taxes and fees last year.
“They seem to have more money than God and they’re able to build without the need for these types of incentives,” said Rader, who is proposing new data-center taxes and requirements that developers pay more for power and electrical infrastructure. “Our industry has been knocked on our backfoot,” said Steve DelBianco, chief executive of NetChoice, a tech-industry group that fights regulation. DelBianco said that the backlash is based on misinformation and that he has warned state officials that eliminating incentives would hurt their economies. “If you want to get rich as a state or as a town and if you want to pay lower taxes, if you want to create tremendous wealth, if you want your house to be more valuable and everything else, you’re going to want a data center,” he said Friday. “It definitely happened in hyperspeed because of hyperscaling,” said Tim Schram, who specializes in state and local taxes at accounting firm BDO.
Last year’s Republican tax law brought back immediate deductions for equipment purchases that would otherwise be depreciated.
“This is a passing fad,” Boccaccio said of the opposition, “and in two years we won’t have these issues with data centers.”
New Jersey signed off on a half-billion-dollar tax credit for data centers in 2024 after a unanimous state Senate vote. Last month, the state canceled the remaining $250 million—after a 35-4 senate vote in the opposite direction.
