What property tax is generated from a data centre?
The Government of Alberta is taking steps to become North America’s destination of choice for artificial intelligence (AI) data centre investment. As these developments progress, municipalities should be aware of the potential revenue-generating opportunities that data centres can provide.
Most of a data centre’s value is the computing equipment, but that equipment is not subject to assessment or property tax.
Components of a data centre that are eligible for property assessment and taxation are:
- The building structure and improvements to the building including HVAC systems, chillers, pumps, or other mechanical systems, similar to any other commercial property
- The land and improvements to the land (e.g., fences, retaining walls, etc.)
- Power generation and back-up power components.
The building and land improvements will be assessed as market value and any power generation property is assessed under Alberta’s regulated assessment policies for industrial property.
To estimate the potential municipal property taxes from a proposed data centre, Alberta Municipalities (ABmunis) recommends working with the developer and an assessor to estimate the value of what is being constructed, excluding the computing equipment.
To learn more, including what revenue the province collects from data centres, visit ABmunis’ Property Assessment and Taxation page or contact the Government of Alberta’s AI data centre concierge service.
