Yahoo gets hit with 7.9 sales tax for Quincy Data Center

Yahoo had a ribbon-cutting ceremony for its new facility in Quincy with David Filo, co-founder attending. A recent finding by the Washington state attorney general removes a 7.9 tax break for this new data center.

The loss of the tax break could keep Yahoo from investing in future phases of the data center that opened Monday, Filo said.

"So far everything has worked out well," he said, noting the favorable economic, political and geographic conditions that have made building data centers in the middle of farm fields in Central Washington a sensible thing to do. The abundance of cheap power available in the region is the bottom-line benefit for server farms, but the rural tax break is so significant that Yahoo would not have built in Quincy had it not been part of the equation, said Laurence Mann, a Yahoo senior vice president.

The sales tax break would have saved Yahoo and other data centers the 7.9 percent tax charged on construction and equipping of a facility, said Mike Gowrylow, a spokesman for the state Department of Revenue.

Microsoft opened a portion of a 500,000-square-foot data center in Quincy in April. The tech company Intuit also is building a facility in Quincy.