This bill proposes a sales and use tax exemption for goods and services related to data center operations in South Dakota. It introduces new definitions for terms such as "computer software," "data center," "enterprise information technology equipment," and "qualified business," among others. A "qualified data center" is defined as a facility that meets specific criteria, including being equipped with fire suppression systems and having a qualifying date between July 1, 2026, and June 30, 2036. The bill also stipulates that gross receipts from the sale of enterprise information technology equipment or computer software used in a qualified data center will be exempt from taxation for a period of fifty years following the qualifying date.

To qualify for this exemption, businesses must submit documentary evidence to the Department of Revenue to verify their eligibility, which will remain confidential. Additionally, businesses must ensure that their electric service agreements do not shift costs to other customers and must notify local water providers about their water consumption needs. The bill mandates that qualified businesses file an affidavit annually to maintain their exemption status. Overall, this legislation aims to promote the establishment and operation of data centers in South Dakota by providing significant tax incentives.