Indiana House Bill 1405, passed on May 5th 2019, establishes a sales and use tax exemption for the purchase of certain qualified data center equipment that is located in a data center that results in a minimum qualified investment within five years, ranging from at least $25 million to more than $150 million depending on the population of the county in which the data center is located.
It provides that certain other costs, such as that for tangible and intangible personal property that is essential to the operations of a data center, excluding property used in the administration of the facility, are exempt from sales and use tax.
Further, it provides that the purchase of all electricity used by qualified data center equipment, excluding electricity used in the administration of the facility, is exempt from sales and use tax.
The bill requires a qualified data center user to apply to the Indiana Economic Development Corporation (IEDC) for a specific transaction award certificate and enter into an agreement with the IEDC as a condition of receiving an award certificate.
Basically, this is a blanket purchase exemption that applies to the Digital Crossroad project so each and every tenant and sub-tenant can participate with our approval. The customer would avail themselves of this by sharing a copy of Digital Crossroad’s award, corresponding resale certificate and form ST-105 (Exemption form).
After completion of the purchase and payment, Digital Crossroad will report the customer’s purchase to Indiana for record keeping purposes against Digital Crossroad’s blanket award.
Digital Crossroad believes this exemption will offer our customers a significantly lower Total Cost of Ownership (TCO) compared to other data center markets, such as Chicago. Contact us to learn more.