Massachusetts Finalizes Data Center Tax Exemption Amid Local Opposition and Moratorium

Massachusetts recently enacted a long-awaited 20-year sales tax exemption for qualified data centers, covering equipment, software, electricity, and construction costs. To be eligible, data centers must be at least 100,000 square feet, create 100 jobs, and invest at least $50 million. This statewide incentive arrives amidst increasing local opposition and scrutiny of data centers' resource consumption across the country. In Massachusetts, Lowell residents recently sued state regulators over past data center approvals, and the city implemented the state's first data center moratorium in March. Eric Paley, Secretary of Economic Development, acknowledged these concerns, stating that while the state is open to working with data centers that address externalities like electricity and water, communities may view these projects differently. He emphasized the importance of AI infrastructure for the state's long-term economic success. The article also touches on other state-level political issues, including the Massachusetts Taxpayers Foundation's opposition to several ballot measures concerning tax cuts and rent control, arguing they could harm the state's economic future.