Politics
Crowley backs ending Wisconsin’s data center sales-tax exemption after earlier calls for review
Democratic gubernatorial candidate David Crowley says he would sign a Republican bill repealing Wisconsin’s data center tax break, a shift from his earlier support for tighter review of the subsidy. The exemption is projected to cost the state billions in forgone revenue, as debate grows over energy use, utility costs and public benefits.
Democratic gubernatorial candidate David Crowley says he would sign legislation repealing Wisconsin’s sales-tax exemption for data centers, reversing his earlier position that the subsidy should face more rigorous review.
At a Wednesday forum hosted by UpNorth News, Crowley said he would “absolutely” sign a Republican-authored bill to eliminate the tax break if it reached his desk as governor. He argued the incentives shift costs onto residents while benefiting some of the world’s wealthiest technology companies.
“These tech companies are getting billions of dollars in tax breaks,” Crowley said. “It’s being delivered on the backs of hardworking families.” He also said data centers should help pay for the energy and utility services they use.
The exemption was approved as part of Wisconsin’s 2023-25 state budget, which was passed by the Republican-controlled Legislature and signed by Democratic Gov. Tony Evers. It covers sales taxes on purchases including equipment and construction materials. A spring estimate from the nonpartisan Legislative Fiscal Bureau put the potential cost at roughly $1.5 billion initially, plus $369 million annually.
Republican lawmakers proposed repealing the exemption last week. The Legislature is not currently in session, making action unlikely unless lawmakers are called back for a special session.
Crowley had previously advocated a tougher review of the tax incentives rather than eliminating them outright. In a summer questionnaire, he said incentives should be tied to measurable public benefits, such as job creation, growth in the local tax base and infrastructure investment. He has also said data centers receiving state or local tax benefits should commit to using at least 70% renewable energy.
Republican gubernatorial candidate Tom Tiffany has called for fully ending the exemption and has criticized Crowley’s earlier position in political ads. Tiffany said he would sign legislation repealing the break, which he described as projected to cost Wisconsin more than $2 billion in lost revenue.
The candidates have both called for more regulation of data centers and protections for the environment and utility customers. The tax exemption has been a notable point of disagreement as public opposition to data center development has grown.
A September report by the Wisconsin Policy Forum said some of the revenue forgone through the exemption could be offset by other taxes, including property taxes in communities hosting data centers, taxes paid by construction companies and utility providers, and sales taxes paid by construction workers. The debate over the exemption is part of a broader question for Wisconsin communities: whether the economic benefits of attracting data centers justify the public costs associated with their tax treatment, energy demand and infrastructure needs.