New data center taxes? Amazon bails

Mercifully (so far), one of the few tax increases included in the state budget “deal” involves subjecting to taxation electricity used by data centers.

As a direct result, though, the Minnesota Star Tribune reports:

Amazon suspends Minnesota data center as lawmakers plan to reduce Big Tech tax breaks

Those willing to invest billions of dollars into the state economy just aren’t that plentiful. Knock Amazon off of that short list.

Amazon’s project would be an Xcel customer, possibly its biggest. The project likely would cost billions to build, resulting in many construction jobs.

The legislature adjourned earlier this week with most of the budget left undone, including no agreement on tax or energy legislation. In fact, the negotiating parties cannot even agree on what they’ve already agreed to.

Session Daily reported last night:

For example, there’s a provision in both [House and Senate] bills that would require data centers to pay taxes on electricity, a tax from which they’re currently exempt. But is that contingent upon an extension until 2062 of those companies being able to purchase equipment and software tax-free?

No one seems to know for sure.

When the legislature adjourned its regular session for 2025 on Monday, there was loose talk that a special session would be convened this week to conclude the year’s business. That window seems to have closed, and with the holiday weekend upon us, we may be looking at June.

In the meantime, expect the smart money to avoid the North Star State.