OLYMPIA: : Gregoire signs bills granting tax breaks to businesses

March 26, 2010 

Gov. Chris Gregoire signed two bills into law Thursday that extend tax breaks to server farms and aluminum smelters.

Although the Legislature is grappling with a huge budget deficit, Gregoire said the tax incentives were necessary to boost jobs in Washington.

One bill gives a temporary sales tax break for companies that build and operate server farms in rural areas. Server farms, also called data centers, are large, computer-filled buildings that tech companies use to handle data storage and Internet traffic.

The sales and use tax exemption takes effect in April and lasts until 2018, applying to server equipment, software and electric infrastructure at eligible computer data centers in rural areas.

The second tax break extends existing tax preferences for aluminum smelters. Legislative estimates peg the value of those tax breaks at about $3.5 million per year.

Smelter owners pay a lower business tax rate, and get a credit on business taxes for the amount of property taxes paid on a smelter property. They also are given a sales tax credit, and an exemption for natural gas delivered through a pipeline.

The Associated Press

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