– In an effort to help retain existing jobs and encourage further investment in western Pennsylvania, Rep. Tedd Nesbit (R-Mercer/Butler) has earned unanimous approval of the House Finance Committee for legislation he is sponsoring to allow data center equipment to be exempt from the state’s Sales and Use Tax.
“Applying a 6 percent sales tax to equipment purchased at data centers adds thousands to the cost of doing business and hampers our ability to keep and attract good jobs,” Nesbit said. “That’s why I am seeking to remove this exemption and give our state a more level playing field to retain and entice these types of high-tech jobs.”
Currently, both Ohio and West Virginia – along with 15 other states – already exempt this type of equipment.
Under Nesbit’s House Bill 1120
, eligible data center owners, operators and tenants must have a combined minimum employee payroll of $1 million within four years of program certification by the Department of Community and Economic Development (DCED). Within four years, the company must invest a combined capital of at least $50 million in a county with a population greater than 250,000 and $25 million in a county with fewer than 250,000 residents. Without these stipulations, the sales tax exemption would not apply.
“With more companies and individuals putting their electronic files on clouds for safe keeping, that information must go somewhere, and that is driving the expansion of data center facilities and their need for high-tech, expensive equipment,” Nesbit explained. “This initiative will enhance Pennsylvania’s prospects for competing to attract these businesses to our state and foster our workforce development through the creation of high-paying, high-tech jobs. This program is a positive step forward to promoting economic growth through increased state and local revenues.”
The measure now moves to the full House for consideration.
Representative Tedd Nesbit
8th Legislative District
Pennsylvania House of Representatives
Media Contact: Jennifer Keaton