In a move that surprises absolutely no one who has ever dealt with Texas “economic development,” the state is currently set to light $3.2 billion in sales tax revenue on fire over the next two years. Why? To make sure companies building massive warehouses full of blinking lights—otherwise known as data centers—don’t have to pay their fair share. Originally, this tax break was a small-time grift costing us maybe $5 million a year, but thanks to the AI boom, it’s ballooned into a billion-dollar annual handout that makes our state leaders look like the world’s worst negotiators.
To qualify for these massive breaks, a company has to “invest” hundreds of millions of dollars and create a whopping 20 to 40 jobs. You read that right. We are forgoing $1.3 billion this year alone to support an industry that employs about as many people as a moderately busy Lubbock Chili’s. Meanwhile, these facilities are projected to suck up enough electricity to power 700,000 homes. It’s a bold strategy for a state where the power grid has the structural integrity of a wet paper towel every time it dips below 40 degrees or hits 100.
Our genius lawmakers are now acting “extremely concerned” that the program they created is actually doing what it was designed to do: hemorrhage money. They’re pointing out that this lost cash could have paid for school vouchers or disaster relief funds, but instead, it’s subsidizing the cooling bills of tech giants. But don’t worry, the industry lobbyists promise that these centers are the “lifeblood of our daily lives,” which is a fancy way of saying they need your tax dollars so you can more efficiently watch TikToks of people in other states having functioning public infrastructure.
Since we’re already subsidizing the very machines that will eventually replace us, maybe we can at least program the AI to figure out how to fix a pothole on 19th Street?
https://www.texastribune.org/2026/04/08/texas-data-centers-sales-tax-break-billion-dollars/
