Data Center Tax Incentives Extended In Washington State

Data centers have been given an extension on tax breaks in Washington state.

The state legislature of Washington passed a bill at the beginning of July that would extend data center tax incentives. The tax breaks, which were originally set to expire July 1, will cover facilities that are currently operating in the state and also data centers still to be built and will use tax exemption for server equipment and power infrastructure.

Growing tax revenues from data centers have likely fueled the extensions. Nearly $4 billion has been collected in tax revenue from rural Washington towns Quincy, Moses Lake and Wenatchee since 2006.

The tax breaks will likely benefit companies like Microsoft, whose Washington data center campus has experienced pauses in construction in 2008 and 2014 due to uncertainty whether tax incentives would be extended.

"Frankly, if the rural tax incentive for the development and construction of data centers were continued, it is highly likely that at least two or three major data center projects, valued at several hundred million dollars, would begin construction in Quincy, Washington or Grant County next year," the Port of Quincy stated in a letter to the legislators ahead of the vote.

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