(The Center Square) – A group of Wisconsin Republican representatives are calling for the end to a data center tax break that has led to $1.5 billion in foregone sales tax to the state and $369 million estimated in tax breaks each year once the projects are complete.

Rep. Shae Sortwell, R-Two Rivers, was the only "no" vote when the tax break proposal was a standalone bill that passed the Assembly before it became part of the budget. Sortwell told The Center Square that data center thoughts have shifted and Republican candidate for governor Tom Tiffany called to end all tax breaks for data centers in the state, meaning it is the right time to end the tax deal.

"It's nice to finally be getting some support from people higher up," Sortwell said. "... We need to continue to push on this because we should not be offering this special grant to one specific kind of company to build in Wisconsin. I do not agree with that principle."

Sortwell, along with Republican Reps. Dean Kaufert, Lindee Brill, and Sen. André Jacque, have begun circulating legislation to end tax breaks on everything from electricity to construction materials and servers at data centers in the state. The tax break was first enacting in 2023 along with the state budget.

The sales tax breaks have far exceeded estimates at the time that the budget enacting those tax breaks was passed as hyperscale data centers have been built in the state. The Wisconsin exemption also applies to replacement servers and materials after the data center has been fully operational.

Wisconsin is one of 38 states that offer tax incentives for data centers but one of just 15 that extend those breaks to sales tax on electricity for the facilities.

Wisconsin’s Department of Revenue estimated the value of the incentives would be $8.5 million for the full multi-year construction of a facility and $735,000 recurring afterward at the time it was initially passed. The department attributed the estimates to the U.S. Chamber of Commerce estimates that a typical data center costs about $215.5 million to construct.

Sortwell told The Center Square that it was clear Democrats in the state support continuing the tax break along with candidate for governor David Crowley.

Wisconsin voters have consistently said that they feel the cost of data centers outweigh the benefits with 74% of registered voters in the state saying so in a recent Marquette poll.

The poll showed 54% of voters believe state incentives reward companies that don’t pay their fair share while 45% believe that the economic benefits of state incentives for business are worth the cost.

The September poll expanded what it asked about data centers and development in September, with just 9% of voters saying data centers were the most desirable of large-scale developments they would like to see in their area with none of the five (44%), a semiconductor fabrication plant (33%), an e-commerce fulfillment center (27%), an automobile manufacturing plant (24%) and a steel or aluminum mill (14%) all more desirable. Respondents could choose more than one option on what they would like to see.

Sortwell said that this summer's failed $2.7 billion surplus return package is an example on how Democrats in the state will make an unpopular move with the public in order to please party leadership.

He pointed out that Gov. Tony Evers has a line-item veto power related to appropriations – something that is the subject of a Nov. 3 statewide referendum – but Evers chose not to use that power to eliminate the tax break from the budget bill.

"I think that, in my party, the support is growing," Sortwell said. "Obviously, the gubernatorial candidate is taking that position and that's very helpful to push legislation and Republican legislators in that direction. As far as Democrats go, no, they realize that this is a political issue so they are trying to deal with it but I don't think they are actually opposed to the actual data centers."