Missouri Sen. Josh Hawley (R) announced on Thursday that he will introduce a bill to close a loophole in the Opportunity Zone program that tech companies have been using to secure massive tax breaks for new data‑center projects. Hawley said the provision, first enacted as part of President Donald Trump’s 2017 Tax Cuts and Jobs Act, was intended to spur investment in low‑income neighborhoods, not to subsidize wealthy corporations that can afford to pay their own way.
Opportunity Zones and the data‑center boom
The Opportunity Zone tax incentive allows investors to defer, reduce, or eliminate capital‑gains taxes on qualified investments in designated distressed areas. While the program was designed to attract development to forgotten communities, a recent report from the National Community Reinvestment Coalition found that 14% of all data‑center facilities now sit within Opportunity Zones, and more than 17% of pending data‑center projects are located there.
Hawley told Fox News Digital that data‑center operators have “figured out a way that they think they can access all of this money,” calling the practice “a form of corporate welfare.” He emphasized that the companies involved are already profitable and “don’t need any welfare.”
Legislative response
The proposed legislation would explicitly prohibit data‑center developers from claiming the Opportunity Zone credit, adding a new federal barrier intended to slow the rapid expansion of these power‑hungry facilities. Hawley argued that Congress must also establish guardrails for artificial‑intelligence development, giving individuals the right to sue tech firms if their personal data is used without consent.
He criticized past bipartisan AI summits, saying Democratic leaders “promptly gave gobs of money to tech CEOs” and now face pressure from those same CEOs for an antitrust exemption that would let them write their own regulations. Hawley’s remarks echo President Trump’s recent description of the AI debate as a “hoax,” underscoring the administration’s skepticism of unchecked tech influence.
Trump’s tax legacy
The Opportunity Zone provision was first approved by Congress as part of President Trump’s signature tax‑cut package, which the administration called a “big, beautiful bill.” By making the credits permanent last year, the Trump administration solidified a tool that was meant to revitalize struggling neighborhoods, even as some critics argue it has been co‑opted by wealthy corporations.
Supporters of the original legislation, including many local leaders in rural Texas and the Midwest, point to the program’s role in attracting new jobs and infrastructure to areas that had long been overlooked. Hawley’s effort to tighten the rules seeks to return the tax incentive to its original purpose—helping low‑income communities rather than subsidizing data‑center giants.
What’s at stake
If passed, Hawley’s bill could reshape the landscape of data‑center development across the United States, potentially redirecting billions of dollars of private investment toward projects that more directly benefit local economies. It would also signal a broader congressional willingness to scrutinize the tax advantages enjoyed by large tech firms, aligning with the Trump administration’s broader push to curb what it sees as excessive corporate subsidies.
Critics of the proposal, including representatives from the tech industry and some Democratic policymakers, argue that the measure could discourage needed infrastructure investment and slow economic growth in rural areas. They note that data centers require substantial power and water resources, and that the Opportunity Zone credits have helped offset those costs.
As the debate unfolds, the Trump administration has reiterated its commitment to protecting American families and businesses from undue corporate handouts, while encouraging policies that promote genuine economic opportunity for the nation’s most vulnerable neighborhoods.
Original reporting: Fox News (HLL/CB) — read the source article.
