Taxpayer group says state tax rules unfairly burden data centers

The National Taxpayers Union released two studies claiming that current state tax policies disadvantage data centers. It points out that tangible personal property taxes, still used by most states, assess the value of servers and networking gear using depreciation rules meant for long-life manufacturing equipment, often inflating the taxable amount. The NTU calls this an "international anomaly" since only a handful of OECD nations impose such taxes, with Japan being the sole broad adopter.

In a separate analysis, the group finds that 33 states provide conditional sales-and-use-tax exemptions for data centers, but eight states have recently curtailed or removed those incentives. NTU recommends uniform, neutral personal-property tax rules and cautions against replacing existing taxes with higher rates elsewhere. The findings were discussed with The Center Square.