Washington Releases Guidance for Data Center Exemption Expiration Dates

The Washington Department of Revenue has released an Excise Tax Advisory providing further detail about the duration of the state’s data center sales and use tax exemptions. The state first introduced an exemption for purchases and installation of server equipment and power infrastructure for a qualifying computer data center located in rural areas in 2010 and added a similar exemption for urban data centers in 2022.

How long a data center exemption can be used depends on factors such as whether the data center is located in a rural or urban area, when construction of the data center commenced, what kind of equipment is involved, and whether the person applying for the exemption is an owner or a tenant of the data center. The rules also apply differently to original server equipment and replacements to initially purchased server equipment, and the latest expiration dates are July 1, 2048. The full chart can be viewed on the notice available on the Washington Department of Revenue website.

(Washington Department of Revenue Excise Tax Advisory 3213.2023, May 22, 2023)

Posted on June 27, 2023