(1)
The sale of "data center property, " as defined in Section 212.08(5)(s)1.d.,
F.S., is exempt from sales tax when the following requirements will be met:
(a) The facility meets the definition of
"data center, " as provided in Section 212.08(5)(s)1.c., F.S.;
(b) The data center's owners and tenants have
made a cumulative, minimum capital investment, after July 1, 2017, of $150
million for the data center, excluding any expenses incurred in the acquisition
of property operating as a data center in the six months prior to the
acquisition.
(c) The data center
must have a critical IT load of 15 megawatts or higher; and,
(d) Each individual owner or tenant within
the data center must have a dedicated critical IT load of 1 megawatt or higher;
and,
(e) Each of the above
requirements is met within 5 years after the commencement of the construction
of the data center.
(2)
Application process.
(a) To qualify for the
exemption for data center property, the data center owner must complete an
Application for Data Center Property Temporary Tax Exemption Certificate (form
DR-1214DCP, incorporated by reference in Rule
12A-1.097, F.A.C.). The
application must state that a qualifying data center designation is being
sought and must be accompanied by information that indicates the exemption
requirements of subsection (1), will be met.
(b) The Department will issue a Data Center
Property Temporary Tax Exemption Certificate (DR-14TDCP) upon a tentative
determination by the Department that the exemption requirements provided in
subsection (1), will be met.
(c)
The data center owner must complete an Application for Data Center Property
Certificate of Exemption (form DR-5DCP, incorporated by reference in Rule
12A-1.097, F.A.C.) once the
exemption requirements have been met. The applicant must deliver to the
Department its Data Center Property Temporary Tax Exemption Certificate, along
with the following documentation sufficient to support that the exemption
requirements have been satisfied:
1.
Certification from a professional engineer, licensed pursuant to Chapter 471,
F.S., whose services are contracted solely to certify that the data center has
met the critical IT load requirement;
2. Certification from a Florida certified
public accountant, as defined in Section
473.302, F.S., whose services
are contracted solely to certify that the data center owners and tenants have
made the required cumulative capital investment.
(d) The Department will issue a Data Center
Property Certificate of Exemption (DR-14DCP) to the data center owner once it
has determined that the documentation provided certifies that the exemption
requirements have been met.
(3) Documenting the exemption.
(a) Data center owners making tax-exempt
purchases of data center property are required to present the Data Center
Property Temporary Tax Exemption Certificate (DR-14TDCP) or the Data Center
Property Certificate of Exemption (DR-14DCP), once issued by the Department, to
the selling dealer.
(b) Tenants and
contractors making tax-exempt purchases of data center property are required to
present a copy of the Data Center Property Temporary Tax Exemption Certificate
(DR-14TDCP) or the Data Center Property Certificate of Exemption (DR-14DCP),
issued to the data center owner by the Department, along with a Certificate of
Entitlement to each vendor to affirm that the purchaser qualifies for the
exemption. The vendor must maintain copies of the certificates until tax
imposed by Chapter 212, F.S., may no longer be determined and assessed pursuant
to Section 212.08(5)(s)
3.c., F.S. Possession by a vendor of the certificate from the purchaser
relieves the vendor from the responsibility of collecting tax on the sale, and
the Department shall look solely to the purchaser for recovery of tax if it
determines that the purchaser was not entitled to the exemption.
(c) The following is the format of the
Certificate of Entitlement to be issued by the data center tenant or data
center contractor when making exempt purchases of data center property:
CERTIFICATE OF ENTITLEMENT
The undersigned _____________________ (the Purchaser) affirms
that it is a tenant or contractor of _______________________ (the Data Center),
located at
________________________ (Data Center Address), and is
eligible to extend the Data Center Property Temporary Tax Exemption
Certificate/Data Center Property Certificate of Exemption to lease or purchase
data center property exempt from sales tax.
The Purchaser affirms that the items purchased or rented from
_______________ (Vendor) will be used exclusively at the data center to
construct, outfit, operate, support, power, cool, dehumidify, secure, or
protect a data center and any contiguous dedicated substations.
The Purchaser acknowledges that if the subject purchased or
leased data center property does not qualify for the exemption provided in
Section 212.08(5)(s),
F.S., and Rule 12A-1.108, F.A.C., the Purchaser
will be subject to the tax, interest, and penalties due on the purchased or
leased property.
I understand that if I fraudulently issue this certificate to
evade the payment of sales tax, I will be liable for payment of the sales tax
plus a penalty of 200% of the tax and may be subject to conviction for a
third-degree felony.
Under the penalties of perjury, I declare that I have read
the foregoing Certificate of Entitlement, and the facts stated in it are
true.
Signature of Purchaser _____________________ Title
_______________________
Purchaser's Name (Print or Type) __________________________
Date
_______________________
Purchaser's Federal Employer Identification Number:
__________________________
Data Center Owner Certificate Number:
______________________
Telephone Number: ______________________
Do not send to the Florida Department of Revenue. This
Certificate of Entitlement must be retained in the vendor's and the tenant's or
contractor's books and records.
(4)
(a) The
exemption for purchases and leases of data center property does not include
rental consideration made for the lease or license to use real property subject
to tax under Section 212.031. F.S. Rental consideration includes all
considerations due and payable by the tenant to its landlord for the privilege
of use, occupancy, or the right to use or occupy any real property for any
purpose, including pass-through charges for common area maintenance and
utilities, except certain electricity charges provided in paragraph (4)(b),
below. See subsection
12A-1.070(4),
F.A.C.
(b) The following charges
for electricity are exempt as charges for "data center property":
1. Charges billed by the utility provider
directly to a data center tenant.
2. Charges billed by the utility provider
directly to a data center owner.
3.
Charges billed to a data center tenant by a data center owner that are
separately stated on the owner's invoice at the same or lower price as that
billed by the utility provider to the owner.
(c) To document the tax-exempt purchase of
electricity as provided in paragraph (4)(b), above, the purchaser shall comply
with the documentation requirements set out in subsection (3), above.
(d) Data center property includes areas,
infrastructure, fixtures and furnishings to be used exclusively at the data
center by persons employed at the data center provided that the employees using
the areas, infrastructure, furniture and fixtures are directly responsible for
the operation, monitoring, security or support of data center
property.
(5) The
Department will conduct a review of registered data centers every 5 years to
ensure that the data center exemption requirements provided in Section
212.08(5)(s),
F.S., continue to be met. The first 5-year period will begin with the date the
Data Center Property Certificate of Exemption (DR-14DCP) is issued to the data
center. Within 3 months before the end of any 5-year period, data center owners
are required to submit a written declaration, under penalties of perjury, that
the required critical IT load requirements of paragraph (1)(a), are met and
that the data center continues to operate in compliance with Section
212.08(5)(s)
1., F.S. The declaration should be sent to Technical Assistance and Dispute
Resolution, Florida Department of Revenue, P.O. Box 7443, Tallahassee, FL
32314-7443.
(6)
(a) If the Department determines that the
data center or any owners, tenants, contractors, or other purchasers have not
met the requirements found in Section 212.08(5)(s), F.S., with respect to any
purchase, then such purchaser is liable to pay the tax that was avoided at the
time of purchase, as well as penalty and interest from the date of
purchase.
(b) If the Department
determines that the data center is no longer in compliance with the provisions
of Section 212.08(5)(s), F.S., then the Data Center Property Certificate of
Exemption (DR-14DCP) will be revoked; any person who made tax exempt purchases
under that certificate will liable to pay any tax that was avoided since the
date the data center fell out of compliance with statutory requirements, as
well as penalty and interest from the date of such purchases; and no further
purchases will be exempt.
(7) Except as provided in paragraph (5)(b),
the exemption provided for data center property is a permanent exemption for
qualifying data centers that apply for and receive a Data Center Property
Temporary Tax Exemption Certificate during the period from July 1, 2017,
through June 30, 2027, and then meet all requirements for the Data Center
Property Certificate of Exemption within five years. The Department will not
process applications for Data Center Property Temporary Tax Exemption
Certificate after June 30, 2027.
