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New York Internet Data Center Sales Tax Exemptions

  • Mar 9, 2012 | Will Frei

The New York Department of Taxation and Finance issued a bulletin explaining Internet data center exemptions

The bulletin explains that to qualify for these exemptions one must "operate a data center specifically designed and constructed as a high security environment for the location of servers and similar equipment that hosts Internet web sites and provides uninterrupted Internet access to customers' Web pages."

The exemptions fall into three categories: tangible personal property, services and contractor expenses. The following lists show examples from each category. For complete lists see the bulletin.

Tangible Personal Property

  • Computer system hardware
  • Pre-written computer software
  • Storage racks and cages for computer equipment


  • Servicing "qualified tangible personal property"
  • Protective and detective services

Contractor expenses

  • Tangible personal property purchased by contractor for use in Internet data center
  • Services purchased to maintain Internet data center

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Will Frei
Avalara Author Will Frei
Will Frei covers sales tax news including best practices, legislation and sales tax technology. He is the Social Media Manager at Avalara.