White Paper Offers Ideas for Raising Revenue to Benefit American Workers Displaced by AI Disruption
Washington, D.C. – Senate Finance Committee Ranking Member Ron Wyden, D-Ore., today unveiled a draft proposal to change the tax treatment of data centers as hyperscalers continue their unprecedented building of data centers used to advance new artificial intelligence (AI) tools.
“American communities are rightfully questioning whether the rapid buildout of data centers across the nation will benefit them, as local disruptions rise and Americans grow concerned about the long-term career prospects of millions of workers,” Wyden said. “These proposals are a first step towards safeguarding taxpayer dollars and ensuring there are resources to support American workers displaced by the coming disruptions to the economy.”
The white paper focuses on two sources of potential revenue:
- Removal of the existing investment incentives in the tax code as they apply to data centers, that are unnecessary for the massive data center buildout going on throughout the country; and
- Creation of a Data Center Public Investment excise tax to provide a consistent revenue stream.
In the last four years, data center construction in the U.S. has quadrupled, impacting communities and workers across the country. This year, hyperscaler spending is set to be roughly $700 billion on data centers, with no end in sight. Meanwhile, anxiety grows among American workers as businesses consider shifting resources to AI tools instead of bolstering their workforce.
The white paper also states that the revenue from these proposals should be used to directly aid workers who are adversely affected by widespread adoption of AI and the dramatic economic changes such an adoption would cause. Ranking Member Wyden is currently developing proposals to support workers through job loss and economic transition. Comments on the white paper’s proposals can be submitted to [email protected], until August 31st.
In April, Wyden pressed major tech companies over the impact of data centers on local water supply, urging companies that don’t already do so to use closed-loop water systems and reduce water consumption, especially in states like Oregon, which are already experiencing drought conditions. He is also exploring ways to limit the impact of data centers on local power supply as energy rates skyrocket across the country.
The text of the white paper is here.
A web version of this release is here.
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