I don't understand why data centers should get special sales tax relief that other businesses don't.
Apart from that, these facilities will strain local resources in rural areas. They've proven in every place they're located to be absolute water and electricity hogs. Rates will rise and wells will run low. It's misleading to pretend other areas haven't experienced this.
Sorry, but if they can't stand on their own without help, please locate elsewhere.
"Nearly 40 states have modernized their tax treatment of data centers through exemptions or rebates. Large scale operators replace their technology equipment about every five years. In states with tax incentives, that equipment is not subject to sales tax."
...........................
The corporations that invest in these data centers are already getting 100% Federal expensing on both plant and equipment. South Dakota has no income tax! That's enough.
In addition, South Dakota already has a business friendly regulatory environment.
We don't need to give away the potential sales and property tax income for cities, counties, and the state in order to make ourselves competitive.
As a former legislator and the founder of a small business that pays sales tax on all supplies and every piece of equipment we use (and which has to charge our clients sales tax on every bit of service they buy), I am skeptical about exempting a single industry from sales tax. We exempt advertising, and that has caused frustration at the Legislature for decades but no one can figure out how to undo it. SD already offers a venue with no income tax; surely that is an advantage over some other states?
You always have to question when someone says an opportunity is "time sensitive". There's a reason scammers use that angle... They're trying to push through these data centers before people have the chance to find out all the negative parts of them. If they're so great, then there will be plenty more built further into the future and our state can jump on the bandwagon then. Let another state be the guinea pig.
Why should the corporations that build these data centers get special treatment? We have to get taxes somewhere since we don't have an income tax. It seems like all the big corporate business owners get all sorts of tax breaks to come into our state where THEY will make money.
My understanding is these take an enormous amount of water and electricity to use. They will be competing with citizens for those utilities and the prices will go up. If citizens have to pay sales taxes they should too.
Sounds like he knows nothing about the industry except talking points. None of his comments has any depth regarding the intricacies or dangers of AI. Let's just jump off a cliff because everyone else is...I thought most people learned that in 3rd grade. You do realize that AI WILL be "the authority" with no possibility for us to "redress" (the word in our constitution that prevents the government from being a dictator). If we allow AI to become the monster it promises, we WILL be at the mercy of those who set the rubric in motion. Before we listen to a kid's talking points maybe ask the wisdom of those of us who have been around a bit and know all that glitters is not gold.
I asked CoPilot if this article was written by AI—it didn’t give me a clear yes or no, but when examining the question, it highlighted a number of indications that it was . . . and when you ask AI for talking points about the value of AI, some of what were given were directly quoted in the article. This isn’t a spell check or a grammar check—it’s saying hey, write an opinion piece supporting the elimination of taxes on equipment for AI data centers.
The whole notion that cutting taxes on a specific industry is deemed “modernizing” tax treatment, instead of cutting taxes is just so much deceptive language. Who wouldn’t support modernizing taxes? Here’s my biggest cripe—aside from having to put up with AI written bullshit. AI doesn’t work—sure, it’s being used to do a number of things, but consider this excerpt from an article about using AI in research. Scientists are a skeptical bunch — it’s in the job description. But when it comes to AI, researchers are growing increasingly mistrustful of the tech’s capabilities.
In a preview of its 2025 report on the impact of the tech on research, the academic publisher Wiley released preliminary findings on attitudes toward AI. One startling takeaway: the report found that scientists expressed less trust in AI than they did in 2024, when it was decidedly less advanced.
For example, in the 2024 iteration of the survey, 51 percent of scientists polled were worried about potential “hallucinations,” a widespread issue in which large language models (LLMs) present completely fabricated information as fact. That number was up to a whopping 64 percent in 2025, even as AI use among researchers surged from 45 to 62 percent.
Anxiety over security and privacy were up 11 percent from last year, while concerns over ethical AI and transparency also ticked up.
In addition, there was a massive drop-off in hype compared to last year, when buzzy AI research startups dominated headline after headline. In 2024, scientists surveyed said they believed AI was already surpassing human abilities in over half of all use cases. In 2025, that belief dropped off a cliff, falling to less than a third.
These findings follow previous research which concluded that the more people learn about how AI works, the less they trust it. The opposite was also true — AI’s biggest fanboys tended to be those who understood the least about the tech.
The whole “we're going to lose out” or “China will win the AI race” is just so much fear-mongering. Huge environmental and energy costs for a few million in property taxes and a handful of jobs once construction is done for a technology that aside from enabling academic cheating, doesn’t seem to work very well? No thanks. And hey, Dakota Scout, is it okay to submit writing that is machine generated without acknowledging it? Maybe we need a little warning sticker: “Parts of this were written by a machine."
By all means let's shovel tax relief to the besieged billionaires, directly or through their shell companies.
Segue to the 'light regulatory environment' --- the PUC denied Crowned Ridge Energy Storage I, LLC, a subsidiary of NextEra Energy Resources an exemption to PUC regulation for battery storage. When will the PUC's questionable over-reach end? Will the PUC regulate commercial and residential buildings that create electricity and send it back to the grid? Our PUC appears as if it's looking for things to regulate outside the common definitions found in the law.
Well written article. The idea that states don't provide tax relief to industry is not accurate. South Dakota alone provides reduced excise tax on farm machinery, tax exemption on repairs for farm machinery, fuel tax exemption for ag use, certain services in the state pay no sales tax, items for resale are not taxed and the list goes on. It is hard to lose sales tax revenue on sales that never happen. The property tax relief alone would be a huge benefit to the counties where these can be located. As far as water and electricity recycling and generating their own power is becoming an option. Lay out the parameters and see if they can meet the criteria of the county they are looking at. Having a NIMBY mindset will not help economic growth in our state. We need more tax revenue and jobs for our young people to want to stay here.
I don't understand why data centers should get special sales tax relief that other businesses don't.
Apart from that, these facilities will strain local resources in rural areas. They've proven in every place they're located to be absolute water and electricity hogs. Rates will rise and wells will run low. It's misleading to pretend other areas haven't experienced this.
Sorry, but if they can't stand on their own without help, please locate elsewhere.
"Nearly 40 states have modernized their tax treatment of data centers through exemptions or rebates. Large scale operators replace their technology equipment about every five years. In states with tax incentives, that equipment is not subject to sales tax."
...........................
The corporations that invest in these data centers are already getting 100% Federal expensing on both plant and equipment. South Dakota has no income tax! That's enough.
In addition, South Dakota already has a business friendly regulatory environment.
We don't need to give away the potential sales and property tax income for cities, counties, and the state in order to make ourselves competitive.
We already are competitive.
Let them come to us.
As a former legislator and the founder of a small business that pays sales tax on all supplies and every piece of equipment we use (and which has to charge our clients sales tax on every bit of service they buy), I am skeptical about exempting a single industry from sales tax. We exempt advertising, and that has caused frustration at the Legislature for decades but no one can figure out how to undo it. SD already offers a venue with no income tax; surely that is an advantage over some other states?
You always have to question when someone says an opportunity is "time sensitive". There's a reason scammers use that angle... They're trying to push through these data centers before people have the chance to find out all the negative parts of them. If they're so great, then there will be plenty more built further into the future and our state can jump on the bandwagon then. Let another state be the guinea pig.
These AI data centers take up huge resources. Specifically electricity and water. Exempting them from sales taxes is wrong.
If we don't take care of our water now, the only water we will have left is our tears.
If it sounds too good to be true, it probably is.
Why should the corporations that build these data centers get special treatment? We have to get taxes somewhere since we don't have an income tax. It seems like all the big corporate business owners get all sorts of tax breaks to come into our state where THEY will make money.
My understanding is these take an enormous amount of water and electricity to use. They will be competing with citizens for those utilities and the prices will go up. If citizens have to pay sales taxes they should too.
Sounds like he knows nothing about the industry except talking points. None of his comments has any depth regarding the intricacies or dangers of AI. Let's just jump off a cliff because everyone else is...I thought most people learned that in 3rd grade. You do realize that AI WILL be "the authority" with no possibility for us to "redress" (the word in our constitution that prevents the government from being a dictator). If we allow AI to become the monster it promises, we WILL be at the mercy of those who set the rubric in motion. Before we listen to a kid's talking points maybe ask the wisdom of those of us who have been around a bit and know all that glitters is not gold.
Is he Noem's son in law?
I think so
I asked CoPilot if this article was written by AI—it didn’t give me a clear yes or no, but when examining the question, it highlighted a number of indications that it was . . . and when you ask AI for talking points about the value of AI, some of what were given were directly quoted in the article. This isn’t a spell check or a grammar check—it’s saying hey, write an opinion piece supporting the elimination of taxes on equipment for AI data centers.
The whole notion that cutting taxes on a specific industry is deemed “modernizing” tax treatment, instead of cutting taxes is just so much deceptive language. Who wouldn’t support modernizing taxes? Here’s my biggest cripe—aside from having to put up with AI written bullshit. AI doesn’t work—sure, it’s being used to do a number of things, but consider this excerpt from an article about using AI in research. Scientists are a skeptical bunch — it’s in the job description. But when it comes to AI, researchers are growing increasingly mistrustful of the tech’s capabilities.
In a preview of its 2025 report on the impact of the tech on research, the academic publisher Wiley released preliminary findings on attitudes toward AI. One startling takeaway: the report found that scientists expressed less trust in AI than they did in 2024, when it was decidedly less advanced.
For example, in the 2024 iteration of the survey, 51 percent of scientists polled were worried about potential “hallucinations,” a widespread issue in which large language models (LLMs) present completely fabricated information as fact. That number was up to a whopping 64 percent in 2025, even as AI use among researchers surged from 45 to 62 percent.
Anxiety over security and privacy were up 11 percent from last year, while concerns over ethical AI and transparency also ticked up.
In addition, there was a massive drop-off in hype compared to last year, when buzzy AI research startups dominated headline after headline. In 2024, scientists surveyed said they believed AI was already surpassing human abilities in over half of all use cases. In 2025, that belief dropped off a cliff, falling to less than a third.
These findings follow previous research which concluded that the more people learn about how AI works, the less they trust it. The opposite was also true — AI’s biggest fanboys tended to be those who understood the least about the tech.
The whole “we're going to lose out” or “China will win the AI race” is just so much fear-mongering. Huge environmental and energy costs for a few million in property taxes and a handful of jobs once construction is done for a technology that aside from enabling academic cheating, doesn’t seem to work very well? No thanks. And hey, Dakota Scout, is it okay to submit writing that is machine generated without acknowledging it? Maybe we need a little warning sticker: “Parts of this were written by a machine."
One more piece of information: https://www.honest-broker.com/p/10-scary-headlines-the-ai-cult-doesnt?r=1xrzbf&utm_campaign=post&utm_medium=web
By all means let's shovel tax relief to the besieged billionaires, directly or through their shell companies.
Segue to the 'light regulatory environment' --- the PUC denied Crowned Ridge Energy Storage I, LLC, a subsidiary of NextEra Energy Resources an exemption to PUC regulation for battery storage. When will the PUC's questionable over-reach end? Will the PUC regulate commercial and residential buildings that create electricity and send it back to the grid? Our PUC appears as if it's looking for things to regulate outside the common definitions found in the law.
Well written article. The idea that states don't provide tax relief to industry is not accurate. South Dakota alone provides reduced excise tax on farm machinery, tax exemption on repairs for farm machinery, fuel tax exemption for ag use, certain services in the state pay no sales tax, items for resale are not taxed and the list goes on. It is hard to lose sales tax revenue on sales that never happen. The property tax relief alone would be a huge benefit to the counties where these can be located. As far as water and electricity recycling and generating their own power is becoming an option. Lay out the parameters and see if they can meet the criteria of the county they are looking at. Having a NIMBY mindset will not help economic growth in our state. We need more tax revenue and jobs for our young people to want to stay here.