In a bold move that could redefine America’s approach to artificial intelligence infrastructure, OpenAI reportedly urged the Trump administration to expand the Chips Act tax credit to include data centers. While the Chips and Science Act was originally crafted to boost semiconductor manufacturing, OpenAI’s request signals a shift in focus, from chip fabrication to the broader ecosystems that power advanced AI models.
Artificial intelligence doesn’t just rely on cutting-edge chips; it thrives on massive computational networks that can process billions of parameters in real time. These networks live inside sprawling, high-powered data centers, which have become the digital factories of the modern age.
If the Trump administration were to embrace OpenAI’s request, it wouldn’t just be about tax incentives, it would be a strategic pivot in U.S. industrial policy, aligning tax breaks with the future of AI infrastructure rather than just its components.
The Chips Act: A Quick Overview
The Chips and Science Act, passed in 2022, was designed to reduce America’s dependence on foreign-made semiconductors and strengthen domestic manufacturing. It included $52 billion in subsidies and a 25% tax credit for companies investing in chip production facilities. The intent was clear: make America the world leader in semiconductor innovation again.
However, the act’s scope was limited to chip production, packaging, and related R&D facilities. This narrow definition excluded other vital infrastructure such as the massive data centers that use those chips to drive technologies like AI, cloud computing, and advanced analytics.
As AI workloads have grown exponentially, companies like OpenAI have discovered that the true challenge lies not just in acquiring chips like Nvidia’s H100s but in housing, cooling, and powering them efficiently. That’s why OpenAI’s appeal for an expanded tax credit makes sense from an operational standpoint: without data centers, chips are like engines without cars.
Why Data Centers Matter in the AI Boom
To understand OpenAI’s reasoning, it’s important to grasp just how critical data centers have become. Every time ChatGPT generates a response, a vast network of GPUs and CPUs inside a data center processes that request. Training a large language model like GPT-5 requires thousands of interconnected chips, running 24/7, consuming megawatts of electricity.
Modern AI data centers are the new industrial infrastructure, comparable to factories of the 20th century. But they’re also expensive, building a single high-end facility can cost over $1 billion. The energy costs alone can be astronomical, especially when factoring in cooling systems and power redundancy.
By extending Chips Act tax credits to cover these facilities, the U.S. could accelerate AI deployment, attract private investment, and strengthen the nation’s digital backbone. For OpenAI and its partners, especially Microsoft, which builds and operates many of OpenAI’s data centers the impact would be transformative.
OpenAI Strategic Request to the Trump Administration
OpenAI’s push to expand the Chips Act isn’t just a plea for financial relief, it’s a strategic move to secure long-term stability for the AI ecosystem. With the Trump administration signaling renewed interest in domestic technology dominance, OpenAI sees a window to position data centers as a national priority.
The company argues that the Chips Act, as currently written, leaves a gap in the AI value chain. You can’t have a robust AI economy without the physical infrastructure to train and deploy models. Expanding the tax credit would create a full-spectrum incentive, from manufacturing the chips to hosting and operating them domestically.
It’s also a geopolitical play. China, the EU, and other regions are investing heavily in data infrastructure. If the U.S. fails to match that pace, it risks falling behind in the AI arms race. OpenAI’s proposal could be seen as a call for America to double down on AI infrastructure before rivals seize the lead.
The Economic Logic Behind the Proposal
From an economic perspective, expanding the Chips Act tax credit to data centers could stimulate billions in new investment. AI-related data centers create high-paying jobs, increase demand for renewable energy innovation, and drive local economies.
For every new data center built, communities benefit from construction projects, power grid upgrades, and ongoing operational employment. Moreover, a tax credit could make it easier for startups and smaller AI firms to compete, reducing dependence on Big Tech.
Critics might call this corporate favoritism, but the logic mirrors traditional industrial policy: incentivize strategic infrastructure that benefits national competitiveness. Just as the original Chips Act was about ensuring chip supply, this proposal is about securing compute supply, the next critical resource in the AI economy.
Political Context: Trump Administration’s Tech Priorities
The Trump administration has historically taken a pragmatic approach toward domestic industry. While it has emphasized manufacturing, job creation, and national security, technology policy under Trump has sometimes oscillated between regulation and deregulation.
Responding favorably to OpenAI’s proposal could fit within a “Made in America” narrative, reinforcing the administration’s commitment to keeping AI innovation within U.S. borders. It would also appeal to economic nationalists eager to see America outpace China in AI infrastructure.
However, this move would likely face congressional scrutiny. Lawmakers would need to assess whether expanding tax incentives to private data centers aligns with the Act’s original intent or opens the door to uncontrolled corporate benefits.
