Scope
Iowa Code section 423.4, subsections 7 and 8 (Code 2026), let the owner of a data center business, as defined in section 423.3(95), apply to the Department of Revenue for a refund of fifty percent of state sales or use tax. Subsection 7 covers fuel and electricity used for the data center business facility, for up to five consecutive years, where the investment in an Iowa location is at least $1 million but not more than $10 million for a newly constructed building or $5 million for a rehabilitated building. Subsection 8 covers computers, equipment, backup power generation fuel and electricity for a data center business that is not eligible for the section 423.3(95) exemption, has at least 5,000 square feet, and meets the minimum investment the subsection states; the refund runs ten years for an investment below $136 million and seven years for $136 million to under $200 million. The refunds apply to state tax only and do not apply to local option sales and services taxes.
- Geographic scope
- Iowa
- Jurisdiction
- State
- Authority type
- Legislature
- Issuing authority
- Iowa General Assembly
Dates
- Adopted
- No adoption day is recorded
- Effective
- Effective date not stated in the source
- Scheduled expiration
- See completion condition
- Ended
- Not recorded as ended
- Completion condition
- Refund periods run per data center business: up to five consecutive years under subsection 7, and ten or seven years under subsection 8 depending on the investment. The opened text states no program-wide end date.
- Source document
- The source page states no document date
- Last checked
- 23 September 2026 (earlier than tracker date 5 October 2026; not an automatic status change)
Summary
Iowa Code section 423.4 gives two partial refunds of state sales and use tax to data center businesses that do not use the larger section 423.3(95) exemption. Subsection 7 refunds half of the state tax on fuel and electricity for up to five years for an investment of $1 million up to $10 million (new construction) or $5 million (rehabilitation). Subsection 8 refunds half of the state tax on computers, equipment, backup fuel and electricity for ten or seven years for larger investments below $200 million at a facility of at least 5,000 square feet. The refunds exclude local option taxes. This is a tax refund, not a permit, siting or utility rule.
What this does not establish
- The source is the Iowa Code 2026 compilation of section 423.4. The first effective day of subsections 7 and 8 is not stated in the opened text, so no effective day is stored.
- 2026 Iowa Acts chapter 1040 (House File 2357, the Code corrections act approved 16 April 2026, effective 1 July 2026), section 89, changed only a cross-reference in subsection 8 from paragraph "e" to paragraph "f" of section 423.3(95). That technical correction is not recorded as a separate instrument.
- The large-investment exemption in section 423.3(95) is the separate record ia-code-423-3-95-data-center-business-exemption. The two are separate statutes.
- Department of Revenue rule 701-215.13 and its guidance page describe these refunds; they are implementation materials and are recorded separately.
- No list of refund claimants was checked, and the record does not establish that any named facility qualifies.
Unresolved questions
- The session laws that first enacted subsections 7 and 8 were not opened.
Relationships
Supersession means a later instrument replaces the earlier legal effect. Repeal links identify the repeal instrument and the measure it ends. A later implementation or related letter is not treated as a replacement unless the record says so.
- Related, not a replacement Data center business sales tax exemption (In effect)
Sources
https://www.legis.iowa.gov/docs/code/423.4.pdf
- 2026 Iowa Acts chapter 1040 (HF 2357, Code corrections) Section 89 technical cross-reference correction to subsection 8, approved 16 April 2026 · 16 April 2026