Wyden Proposal Would Change Tax Incentives For Data Centers

Oregon Senator Ron Wyden is proposing changes to how massive AI data centers are taxed, saying rural communities deserve a greater share of the benefits as development accelerates. Wyden's plan would eliminate certain federal tax incentives for data centers and create a new excise tax, with the revenue used to help workers displaced by artificial intelligence.

“American communities are rightfully questioning whether the rapid buildout of data centers across the nation will benefit them, as local disruptions rise and Americans grow concerned about the long-term career prospects of millions of workers,” Wyden said. “These proposals are a first step towards safeguarding taxpayer dollars and ensuring there are resources to support American workers displaced by the coming disruptions to the economy.”

The senator says communities are facing growing concerns over increased demands on water and electricity, especially in drought-prone states like Oregon, while questioning whether the projects create enough long-term local jobs.

In his announcement, Wyden said over the last four years, data center construction in the U.S. has quadrupled, impacting communities and workers across the country. This year, hyperscaler spending is set to be roughly $700 billion on data centers, with no end in sight. Meanwhile, anxiety grows among American workers as businesses consider shifting resources to AI tools instead of bolstering their workforce.

Click Here to read Wyden's proposal.

Wyden is accepting public comments on the proposal through August 31st as lawmakers consider the future of AI-driven development. Comments can be E-mailed Here.

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