Four Wisconsin Republicans are proposing to repeal the sales-tax exemption for data centers that was enacted in the 2023-25 state budget. The measure comes after the Legislature’s last floor session of the year and just weeks before the election; a special session would be needed for it to receive a bill number and public hearing on the current legislative calendar.
The repeal bill was authored by Sen. Andre Jacque (R-New Franken) and Reps. Lindee Brill (R-Sheboygan Falls), Dean Kaufert (R-Neenah) and Shae Sortwell (R-Two Rivers), according to the Wisconsin Examiner. It would end the exemption on sales and use taxes for property and equipment used to construct, renovate or operate data centers, the outlet reported. The co-sponsorship memo argues that the tax code should not be used to effectuate crony capitalism and says public opposition to data centers helped inspire the proposal, according to Urban Milwaukee’s report.
The bill’s sponsors have described it as an effort to begin a discussion for the next Legislature, rather than a measure likely to take effect immediately. Jacque and Kaufert are retiring from the Legislature, the Wisconsin Examiner reported. Brill told WisPolitics.com that starting the conversation now is important even if the bill stalls, according to the Examiner.
A Tax Break Worth Billions, By the State's Own Math
The numbers behind the fight are significant. An analysis conducted by the Legislative Fiscal Bureau in March found that the exemption has already saved Wisconsin developers $1.5 billion, per the Wisconsin Examiner's reporting. A separate accounting cited by Seehafer News put the potential construction-period savings at over $1.5 billion, with an additional $369 million annually once projects are completed.
The Milwaukee Journal Sentinel has described the same exemption in slightly different terms, reporting that the state will be out $1.5 billion in forgone state sales tax revenue during construction, which can take years, plus the $369 million annual figure once facilities are running. The underlying $1.5 billion estimate shows up consistently, even as outlets frame it differently as either savings to developers or lost revenue to the state.
The exemption itself was created in 2023 through Wisconsin Act 19, according to Seehafer News, and the Wisconsin Economic Development Corporation administers the program today. Under current WEDC rules, a company can qualify for the break based on a five-year investment plan of at least $150 million, $100 million or $50 million depending on the population of the host county, as reported by Wisconsin Economic Development Corporation.
How Many Data Centers Have Qualified?
A March 18, 2026, memo from the Legislative Fiscal Bureau said the Wisconsin Economic Development Corporation had certified four data centers as eligible for the Act 19 exemption.
The bureau’s expenditure-report table estimated foregone sales-tax revenue of $10.8 million for 2024 and $12.2 million in currently available 2025 reports. It cautioned that 2025 annual report data were not yet available, so the latter total reflected only reports then on hand. Those figures track estimated tax savings, not the projects’ investment or employment commitments.
From GOP Priority to GOP Target
The exemption was first proposed as standalone legislation in June 2023 by more than a dozen Republicans, months before it was included in the state budget, the Wisconsin Examiner reported. Rep. Shannon Zimmerman argued at the time that data centers would provide storage and processing capacity to meet societal demand, while bringing construction jobs and, later, highly skilled, highly paid workforces.
At an April 30, 2025, hearing, Rep. Mark Born said two large data centers were already under construction in Wisconsin and others were being planned, according to the Wisconsin Examiner. Proposals have also surfaced in Beaver Dam, Wisconsin Rapids, Port Washington and Kenosha, Wisconsin Watch has reported.
Other Data Center Bills Have Stalled in Madison
Lawmakers have also debated who should pay for the energy infrastructure data centers require. A Republican proposal from Rep. Shannon Zimmerman and Sen. Romaine Quinn would have required data centers to pay for their own power development and build on-site renewable facilities. It passed the Assembly but failed in the Senate; opponents said the renewable-energy requirement could discourage solar and wind projects, the Wisconsin Examiner reported.
Other proposals addressed oversight and local development rules. A bill from Democrats Jodi Habush Sinykin and Angela Stroud would have required energy-use reporting, encouraged renewable energy and mandated union labor on data center projects; it received a public hearing but did not advance, according to the Wisconsin Examiner. Separately, a Republican bill introduced in April 2025 would have exempted data centers from the state limit on tax increment districts’ share of a community’s taxable property. It did not reach either chamber’s floor.
The latest repeal bill faces its own procedural hurdle. A special session of the Legislature would need to be called for the proposal to receive a bill number and a public hearing during the current legislative calendar, the Wisconsin Examiner reported, leaving its near-term prospects uncertain even as sponsors frame it as the opening of a longer debate.
A National Shift From Incentives to Regulation
Wisconsin's reversal mirrors a broader national trend. In 2026, only 61 of 262 state data center bills nationwide covered incentives, the Milwaukee Journal Sentinel reported, a sign that state legislatures are increasingly focused on regulating the facilities rather than subsidizing them. Thirty-eight states currently offer data center sales tax exemptions or other tax breaks, according to the National Conference of State Legislatures as cited by the Journal Sentinel, and the outlet reported that Minnesota is among the states that have already taken steps to restrict or roll back similar exemptions.
The debate also touches on Wisconsin's energy capacity. The Wisconsin Policy Forum has reported that total energy sales by Wisconsin utilities have fallen 9% since 2005, even as planned and potential data centers could require costly new utility investments, according to the Wisconsin Policy Forum. That tension between shrinking baseline demand and the enormous power needs of new data centers has become a recurring backdrop to the Legislature's on-again, off-again attempts to regulate the industry it once worked to attract.
