The Washington state Legislature concluded its 2026 session by passing Senate Bill 6231, which revokes a sales tax break on refurbishing equipment and labor for existing data centers, effective July 1. This change is projected to raise $63.1 million in the current biennium and $143.9 million for the 2027-29 period, according to the state’s Department of Revenue.
Despite this loss, big tech firms successfully avoided stricter regulations on electricity rates and environmental impacts. The Data Center Coalition's Dan Diorio expressed concern over the economic consequences, forecasting job losses and reduced tax revenue, which could create instability in the state's business environment.
In 2023, data centers in Washington contributed nearly 9,000 jobs and generated $1.8 billion in state and local tax income. While the sales tax benefits for new facilities remain intact, the industry is facing challenges, as indicated by Microsoft’s opposition to House Bill 2515, which sought more extensive regulations.
Microsoft operates about 30 data centers in Washington, while Amazon primarily focuses its data center operations in Oregon. Both companies lobbied for changes to the legislation, indicating their vested interests in the outcome.