Virginia’s data center tax abatement, a 15-year-old incentive that has played a key role in securing the commonwealth’s position as the nation’s most dense data center market, is now approaching 10 figures in foregone tax revenue every year.
The total sales and use tax exemptions claimed in fiscal year 2023 alone rose to $932.7 million, based on total statewide qualifying investments in computer equipment and enabling software and hardware of $16.06 billion, according to a recent report to the Senate Finance and Appropriations Committee. That’s up from $673.5 million in fiscal 2022, based on $9.4 billion of qualifying investments.
Separately, Virginia’s recently released Annual Comprehensive Financial Report estimated the total amount of abated taxes for fiscal 2023 at $750.4 million, up from $135.9 million in 2022.
