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Virginia lawmakers debate cutting tax breaks for data centers

Mar 11, 2026, 1:00 AM20
(Update: Mar 11, 2026, 1:12 PM)
state of the United States of America

Virginia lawmakers debate cutting tax breaks for data centers

  • Virginia has invested more than $80 billion in data centers over nearly two decades.
  • Lawmakers are divided over a proposal to end a significant tax break for the data center industry.
  • The outcome of this debate may reshape Virginia's economic landscape and affect its position as a tech hub.
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In Virginia, a significant discussion is underway concerning the future of tax breaks for data centers, which have been pivotal in establishing the state as a global data center hub. Over the past two decades, Virginia has offered tax incentives to tech companies, resulting in over $80 billion in investments and the creation of thousands of jobs. Currently, Virginia senators are advocating to revoke a 5.3% sales tax exemption, which could lead to a considerable fiscal shift. This proposal has sparked contention among lawmakers, particularly among Democrats, as the legislative session approaches a budget deadline.

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