Overview
Mississippi offers a targeted data center incentive program through the Data Center Enterprise (DCE) statute, which provides 10-year tax relief for qualifying facilities. The state recently approved a $10 billion AWS project through project-specific incentives and is actively revising the DCE program through 2025 legislation (SB 3168) that would raise investment thresholds, exclude cryptocurrency mining, and add electricity tax exemptions.
Incentives
Data Center Enterprise Tax Exemptions
Mississippi’s Department of Revenue administers a 10-year tax relief package for certified data center enterprises that meet minimum investment and employment thresholds.[1]
- $20 million minimum capital investment and 20 new full-time jobs at 125% of the state average wage
- 10-year income tax exemption for qualified data center enterprises
- 10-year franchise tax exemption with the same eligibility thresholds
- Sales and use tax exemptions for component building materials, equipment for initial construction or expansion, and replacement hardware/software
- Certification administered by the Mississippi Development Authority (MDA)
Requirements and Conditions
MDA Certification and Compliance
Data centers must obtain and maintain MDA certification to access DCE tax benefits, and the state enforces strict compliance and recapture provisions.
- MDA certification required before accessing any tax exemptions
- Signed agreement with performance requirements and recapture clauses if thresholds are not met[1]
- Exemptions are non-transferable without MDA approval
- Documentation required to verify all exemptions claimed
- Sales tax relief applies only to direct purchases by the certified business; purchases routed through contractors can lose the exemption[1]
Utility and Grid Rules
PSC Special Contract Review
Large data center loads require formal Public Service Commission review and approval of negotiated service contracts.
- The PSC approved a special contract in February 2025 between Mississippi Power and Compass Datacenters for an eight-building campus in Lauderdale County with a reported $10 billion investment[2]
- PSC review establishes regulatory checkpoints for time-to-power and cost allocation for large loads
- Formal commission approval required for special contracts with utility providers
What to Watch
- SB 3168 legislative outcome: The 2025 bill passed the Senate and proposes major DCE program changes including exclusion of digital asset mining, higher capital investment thresholds ($250 million for new construction; $100 million for expansions), a new electricity tax exemption, and up to two automatic 10-year extensions for qualifying expansions. The bill also includes a 60-day cure period after notice of noncompliance.[4]
- PSC cost-allocation framework: Future PSC orders may specify minimum-bill provisions, rate structures, or cost-allocation terms for large data center loads beyond the initial Compass approval.
- Project-specific incentives: Mississippi approved a project-specific incentive package in January 2024 for AWS’s two-campus Madison County project, signaling willingness to negotiate custom terms for large investments.[3]
Sources
[1] Mississippi Department of Revenue, “2025 Incentive Booklet,” June 2025, https://www.dor.ms.gov/sites/default/files/resources/Incentives%20and%20Credits/2025%20Incentive%20Booklet.pdf (accessed 2026-01-08).
[2] Mississippi Public Service Commission (Commissioner De’Keither A. Stamps), “Mississippi Public Service Commission Approves Special Contract Between Mississippi Power Company and Compass Datacenters Jan I, LLC,” press release, February 7, 2025, https://www.psc.ms.gov/sites/default/files/2025-02/PressReleaseFeb2025.pdf (accessed 2026-01-08).
[3] Will Stribling, “Lawmakers approve incentive package for two Amazon Web Services data centers,” Mississippi Public Broadcasting, January 26, 2024, https://www.mpbonline.org/blogs/news/lawmakers-approve-incentive-package-for-two-amazon-web-services-data-centers/ (accessed 2026-01-08).
[4] Mississippi Legislature, “SB3168 (As Passed the Senate) - 2025 Regular Session,” 2025, https://billstatus.ls.state.ms.us/documents/2025/html/SB/3100-3199/SB3168PS.htm (accessed 2026-01-08).