Ohio Governor Mike DeWine has suspended the state’s tax incentive program for data centers, citing a massive disparity between the policy’s actual cost to the public treasury and initial government estimates. The administration has directed the Ohio Tax Credit Authority to cease reviewing new applications for sales tax exemptions while state officials conduct a formal audit of the industry's broader financial and economic impacts.
According to reporting from The Register, the suspension applies exclusively to new requests, meaning projects that have already secured approval will continue to receive their existing tax breaks. This policy shift occurs as public skepticism regarding the proliferation of massive server farms intensifies across the United States.
Data from the nonprofit research organization Good Jobs First indicates that the cost of these tax exemptions reached $1.5 billion in 2025. This figure is approximately 11 times higher than the state’s original forecast of $136 million. Previous reporting from Signal Ohio noted that these losses had already ballooned to $555 million in the prior year, a figure that was itself four times higher than initial projections.
Ohio’s tax exemption is notably broad, covering not only building materials for construction but also the high-cost hardware required to stock data halls, including server racks, cooling systems, and specialized infrastructure. With this latest revelation, Ohio joins a small group of states—including Virginia, Texas, and Georgia—that lose more than $1 billion annually in tax revenue to support cloud-hosting campuses.
Good Jobs First has long argued that these subsidies often fail to generate the promised economic growth. Instead, the organization claims these policies frequently result in taxpayers subsidizing the infrastructure costs of some of the world’s wealthiest corporations. The group recently reported that of 36 states providing such tax exemptions, only five actually disclose the total costs associated with the concessions.
Public pushback against the facilities is also gaining momentum. The advocacy group Ohio Residents for Responsible Development has reportedly gathered 25,000 signatures in five weeks to support a proposed constitutional ban on data centers that consume more than 25 megawatts of power. Similar movements to restrict or regulate the industry are currently underway in Maryland, Nevada, and California, reflecting a growing national trend of resistance to the infrastructure required for artificial intelligence and cloud computing.
