Gov. Beshear calls for ending state tax incentives for data centers
Kentucky Governor Andy Beshear is calling for the repeal of statewide tax incentives for data centers, stating that these wealthy companies do not need financial assistance. The incentives, which were expanded in 2025 to cover all 120 counties, could lead to over $2 billion in lost sales tax revenue according to a recent report. Beshear's stance echoes bipartisan criticism and mirrors actions taken by other states to pause or roll back similar tax breaks.
Kentucky Governor Andy Beshear announced his support for repealing statewide tax incentives for data centers during a press conference on Thursday, echoing recent bipartisan criticism. The incentives, which began in 2024 for Jefferson County and expanded to all 120 counties in 2025, exempt data centers from sales and use taxes on computer equipment for 50 years.
Beshear argued that wealthy companies seeking to build data centers in Kentucky can do so without state financial assistance. The Kentucky Center for Economic Policy, a left-leaning think tank, issued a report suggesting the state could lose more than $2 billion in sales tax revenue if just four proposed data centers are constructed under the current incentive structure. The governor's call aligns with trends in other states, such as Ohio, Arizona, Nebraska, and Illinois, which have paused similar tax incentives, and states like Texas and New York, where governors have proposed moratoriums on data center construction.