Idaho Considering Data Center Tax Breaks

State legislators in Idaho are going to consider a bill to add data center tax breaks to the state’s tax code to make it more attractive for companies looking to build server farms.

The Idaho Department of Commerce supports the measure, which it expects to make the state more competitive in attracting data centers. There are currently seven data centers in Idaho, a department official told the Associated Press. Service providers DataSite and Involta have data centers in Idaho, as well as the FBI, among others.

Twenty other states have data center tax breaks in place today, according to the AP. State and local officials use them as incentives to attract the large construction projects, which create a burst of economic activity in local areas during construction and some long-term jobs once they’re complete, in addition to revenue from property taxes and sales taxes on equipment and energy purchases.

While Idaho’s bill would offer sales tax rebates on server equipment, a lot of expensive network, electrical, and mechanical infrastructure equipment goes into a data center. State officials estimate that the bill would take $531,000 per year out of the state’s general fund.