Wisconsin’s Sales and Use Tax Exemption for Data Center bill signed into law

Wisconsin Governor Tony Evers signed into law the state’s biannual budget this past July. Within that budget was language for a sales and use tax exemption for data centers in Wisconsin. With this inclusion, the state has leveled the competitive playing field for data centers with its neighboring states.

In a joint statement of support for the exemption filed by the Data Center Coalition, a Microsoft spokesperson said, “… total cost of ownership is an important factor. Passage of a data center incentive bill that lowered total cost of ownership would increase Wisconsin’s favorability and enable it to become more competitive with other states … ."

One of the most aggressive sales and use tax exemption bills in the industry, data centers will now be exempt from sales tax on personal property depending on the county in which they chose to develop a data center and the amount of capital investment in a specific project. The sales and use tax exemption does not have a sunset. The threshold to be eligible are:

For buildings located in a county having a population greater than 100,000: $150 million.

For buildings located in a county having a population greater than 50,000 and not more than 100,000: $100 million.

For buildings in a county having a population of not more than 50,000: $50 million.

For buildings located in more than one county, the most populous county in which the buildings are located will be used.

Companies are eligible based on the Department of Revenue determining a company is a data center. This is consistent with other sales and use tax exemptions in Wisconsin, like the exemption for manufacturing.

In anticipation of this new exemption and existing exemptions already in place in Iowa, Alliant Energy has proactively identified, controlled and developed industrial parks to accommodate large-scale utility projects like data centers. Specifically, Big Cedar Industrial Center and Prairie View Industrial Park in Cedar Rapids and Ames, Iowa, respectively, and Beaver Dam Commerce Park in Wisconsin, have been pre-certified and vetted to accommodate large users.

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