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

The Virginia Senate has unveiled a new budget proposal that maintains the sales and use tax exemption for the data center industry, which has been a contentious issue in legislative discussions. However, the proposal introduces a new tiered tax on diesel generators used by the industry, expected to raise $1.8 billion. This move could affect operational costs for data centers while potentially addressing fiscal concerns and sparking debates about the environmental impact of such generators. The proposal's implications for both the tech sector and state finances are significant as it seeks a balance between industry growth and fiscal responsibility.