Elizabeth Warren probes federal tax cuts for Amazon, Google, Meta and Microsoft as AI revenue and data centers grow

But Sen. Elizabeth Warren is focused on what’s shrinking on Big Tech’s balance sheets: their share of corporate taxes. And she’s calling them on it.

In a video on X, she points to Amazon, which paid $7.8 billion less in tax last year.

“That’s right, they raked in higher profits, but paid $7.8 billion less in taxes than they did the year before,” Warren said.

Meta got tax relief of nearly $7 billion in 2025, paying $2.8 billion in federal tax compared to $9.6 billion in 2024.

According to the Institute on Taxation and Economic Policy, Microsoft and Alphabet each qualified for tax cuts of nearly $19 billion last year.

As CNBC reports, Warren and fellow lawmakers sent letters to the CEOs of all four corporations this week, demanding to know more about their tax breaks, and the companies’ lobbying for tax incentives in the One Big Beautiful Bill Act.

Moneywise has reached out to Amazon, Alphabet, and Meta for comment, but did not immediately hear back. Microsoft declined to comment.

Here’s a closer look at the big tax breaks and what they could mean for the federal budget.

Where Big Tech’s big tax breaks come from

Politico notes that Trump’s One Big Beautiful Bill Act includes tax incentives to reward corporate investments, but the tech titans are benefiting most given their massive investments in AI buildouts.

Among other things, the law enshrines 100% bonus depreciation, allowing companies to claim depreciation for qualifying capital investments (like AI data centers) in their first year of operation rather than writing off depreciation over many years.

Last year, Microsoft claimed nearly $12 billion in depreciation tax breaks; Amazon $6.5 billion; Meta $4.9 billion and Alphabet over $3.3 billion.

Meanwhile, according to the New York Times, Meta has been using a tax credit that dates back to 1981 for research and experimentation.

The One Big Beautiful Bill Act updated the R&D tax credit to include tax write-offs for AI. Companies can write off things like wages for computer engineers, computer hardware and cloud server costs for training models.

According to the Times, Meta is describing its AI data centers themselves as experimental “models” and the AI chips it buys as experimental supplies under the Federal R&D tax credit.

R&D tax expert Andre Shevchuck, a partner with the tax and accounting advisory firm BPM, told the Times that this interpretation was “kind of wild and out there.”

In its filings with the Securities Exchange Commission, Meta itself admits that “uncertainties with our research tax credits” mean the Internal Revenue Service might overturn them.

Lost tax revenue, strained federal budgets amid AI boom

According to Reuters, corporate tax revenues are down 23% this year, much of it due to AI tax breaks.

That works out to $96 billion in lost federal revenue, according to Politico, at a time federal debt has reached more than $40 trillion and federal cuts have hit key programs like Social Security and SNAP.

“These tax breaks are not free, their cost has been imposed on American families via cuts to critical social services and a higher deficit,” Warren and her colleagues wrote in their letters.