Hawley Moves to End Opportunity Zone Tax Break for Data Centers Sen. Josh Hawley plans legislation to exclude data centers from Opportunity Zone tax breaks, calling them corporate welfare as data center development surges nationwide. Sen. Josh Hawley, R-Mo. , plans to introduce legislation to close a tax loophole that he says tech giants are using as corporate welfare to build data centers across the country. The loophole involves Opportunity Zones, a program first created by Republicans in 2017 and made permanent last year. Hawley told Fox News Digital in an interview that Opportunity Zones are meant for low-income areas and businesses, not for wealthy tech companies."These data centers have figured out a way that they think that they can access all of this money," he said. "So let's be clear, this is a form of corporate welfare. " The tax breaks were first approved as part of former President Trump's Tax Cuts and Jobs Act of 2017. That law created Opportunity Zones to spur investment in lower income or forgotten areas.The program was made permanent last year through the big beautiful bill. Although not explicitly intended for data centers, the zones have provided a route for tech companies to defer, reduce or eliminate corporate gains taxes on their investments. According to the National Community Reinvestment Coalition, 14% of all data centers are in Opportunity Zones, while just over 17% of permitted or under-construction data center projects are in the zones.Just under half of all Opportunity Zones are in rural areas, where tech companies have increasingly set their sights on building data centers. Data center development is surging across Texas, with North Texas taking the top spot in a new global ranking of leading markets. Virginia's data center boom has also saved homeowners thousands on property taxes, according to one expert.Hawley's push comes as the GOP wrestles with how to handle data center and AI issues, which have become a major political wedge on the campaign trail. Lawmakers have raised concerns since returning to Capitol Hill this week following calls from major AI industry players to slow development. Those calls came after engineers at Anthropic revealed on X that there was roughly a 10% chance AI could wipe out humanity within a decade.The topic of reining in AI is not new. Senate Majority Leader Chuck Schumer, D-N.Y. , convened several panels with tech CEOs including Tesla's Elon Musk and Meta's Mark Zuckerberg to discuss potential AI legislation. Hawley argued Congress needs to put guardrails on AI and give people the opportunity to sue tech companies if their data and personal information was used without consent.When asked why no real action had happened since Schumer's AI summits, Hawley said it was because tech CEOs then gave Schumer and Democrats gobs and gobs of money."They decided that, you know what, maybe this industry is going fine," he said. "And now what you see the same tech CEOs saying is they want an antitrust exemption so they can all talk together and work together. " The senator said tech companies want to write any regulations themselves. "And they're out there saying, 'The sky is falling, the sky is falling.You need to let us get together, write the regulations and figure out what we're going to do.' I'm pretty skeptical of that, I have to say. " Hawley's legislation would exclude data centers from accessing the Opportunity Zone tax cuts, adding another federal barrier in an attempt to slow their rapid development. The move comes as Republicans face pressure over rising utility costs and energy demands linked to the AI boom.