Some state lawmakers, including Ohio State Rep. Tristan Rader (D-Lakewood), want to repeal the sales-tax exemption and renegotiate previous deals with big tech companies like Amazon.com Inc. (NASDAQ:AMZN), Meta Platforms Inc. (NASDAQ:META), and Alphabet Inc.’s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google, which secured exemptions for data centers for decades by inking contracts with the state.

Lawmaker Proposing New Data Center Taxes

Amid the AI boom, the tax exemption had surged to over $1.5 billion in Ohio last year, which was over 10 times the original
state estimate. Earlier this year, Voters were outraged after news outlet Signal Ohio reported on the scale of the provision, resulting in Republican Gov. Mike DeWine pausing new applications for the sales-tax exemption in May, reported the Wall Street Journal.

"They seem to have more money than God and they’re able to build without the need for these types of incentives," said Rader. He is proposing new data-center taxes and requirements that companies pay more for power and electrical infrastructure.

Google, Meta and Amazon did not immediately respond to Benzinga’s request for comment.

Read Also: AI Boom Could Help Create $200B Insurance Market as Data Centers and Energy Projects Surge

Debate Over Data Center Economics Continues

Last month, President Donald Trump said that data centers could eventually become a bigger industry than oil, calling them significant for the U.S. economy.

Earlier this week, Billionaire investor Mark Cuban urged cities and local governments to negotiate tougher deals with data-center developers, arguing that the booming AI infrastructure industry can afford to give communities far more in return.

New York became the first U.S. state to enact a one-year statewide moratorium on new hyperscale data centers in July. The state temporarily paused State environmental permits for up to one year to build a regulatory framework that protects ratepayers, the environment, the energy grid, and communities in the state.

Last month, Investor Kevin O’Leary also weighed in on the data center debate, saying that AI data center developers can no longer rely on communities to accept large-scale projects without clearly explaining their environmental impact, infrastructure plans, and economic benefits.

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