DALLAS (CBRE) – A new data center tax incentive program that went into effect Sept. 1 will enhance Texas’s already favorable economic climate for corporations looking to move to or increase their business within the state, says CBRE Global Research and Consulting in a report released today.
The program provides 100 percent exemption of sales taxes on business personal property essential to data center operations. This includes items such as computers, electrical equipment, cooling systems, power infrastructure and software. The exemption may be available for ten to 15 years and can be accessed by owners and tenants in single- or multitenant data center properties.
To qualify for the sales tax exemption, the data center operation must:
- consist of at least 100,000 sf of gross building area in an entire or portion of a facility,
- involve at least $200 million of total capital investment,
- create at least 20 new direct jobs, and
- pay wages equivalent to at least 120 percent of the county average.
About 17 states have passed similar incentives programs to attract data centers, said John Lenio, economist and managing director of CBRE’s Economic Incentives Group.
In fact, according to the report, the economic impact of a data center in Texas can range from nearly $500 million for a small facility to $1.7 billion for a large facility over ten years.