Senate budget proposal keeps data center sales tax exemption, adds new tax for industry

By: Shannon Heckt

Outlets: Virginia Mercury

Published: June 17, 2026

Words: 667

Last Updated: 1 month ago

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On Tuesday, the Virginia Senate released its latest budget proposal that preserves a sales and use tax exemption for the data center industry, the major hangup that has gummed up negotiations between both legislative chambers.

The revamped proposal also adds a tiered tax for the industry that targets diesel generators and would generate $1.8 billion for the state, Senate leaders said.

Sen. Louise Lucas, D-Portsmouth, has advocated to axe the exemption for …

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