House Bill 1213 would repeal North Carolina’s sales and use tax exemption for data centers. In practical terms, the bill removes several statutory exemptions and related definitions in Chapter 105 of the General Statutes that currently provide tax relief for qualifying data center purchases and activities. The stated effective date for the repeal is July 1, 2026, and it would apply to sales occurring on or after that date.
The bill is narrowly focused on tax policy and does not create a new tax rate or broader consumer protection program despite its short title, “Protect Taxpayers and Consumers.” Instead, it changes the tax treatment of data centers by eliminating exemptions that reduce the cost of equipment, infrastructure, or other qualifying purchases tied to those facilities. As a result, affected businesses would likely face higher sales and use tax liability on future transactions after the effective date.
Impact
The bill would amend North Carolina General Statutes Chapter 105 by repealing specific exemptions in G.S. 105-164.13 and related definitions in G.S. 105-164.3. This would remove existing sales and use tax preferences for data centers, increasing taxable transactions for that industry beginning July 1, 2026. The primary affected parties would be data center operators, developers, and vendors selling qualifying goods or services to those facilities, while the state and local governments could see increased tax collections from those sales.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate, amendment activity, or partisan division in the available record. Based on the bill text alone, the measure appears to be framed as a taxpayer-protection and tax-base-expansion proposal, but the context does not show whether that framing was broadly supported or opposed. The absence of recorded discussion makes the overall sentiment difficult to assess beyond the bill’s clear fiscal intent.
Contention
The likely point of contention is whether repealing the data center exemption is a fair way to raise revenue or whether it would discourage investment in a growing technology sector. Supporters would likely argue that the exemption is a special tax break that should be eliminated to protect taxpayers and consumers and broaden the tax base. Opponents would likely contend that data center incentives are important for economic development, job creation, and attracting large-scale digital infrastructure projects to North Carolina. No specific lawmakers or stakeholder groups are identified in the provided materials, but the dispute would most likely center on fiscal policy versus economic development.