Texas lawmakers reconsider tax incentives for data centers

Twelve years ago, Texas started offering big tax exemptions to entice new data centers. Now, the political climate has changed, and lawmakers say it’s time to reconsider those tax breaks.Debate over data center tax breaksA law that took effect in 2014 allows large tax breaks to entice new data centers to Texas. During the first six years after the law passed, only 10 data centers held exempt status.However, following the pandemic, the state experienced a boom in new facilities. According to the Texas Comptroller's Office, there are now 138 data centers across the state with tax exemptions, and five more applications are pending. That growth accounts for an estimated $3.3 billion in projected tax revenue the state expects to lose.On Monday morning, a Senate committee held a hearing on data centers to discuss the exemptions, with officials from the comptroller's office testifying first. Although the Texas Legislature does not return to Austin until January, the debate over data centers h