A gas pump is pictured at the Franklin Kroger gas station on Aug. 31, 2024.
Leeann Doerflein | Daily Journal
Hoosiers will pay a little less at fuel pumps in October as Indiana’s gas tax drops slightly.
The state’s 7% sales tax applied on gasoline purchases will be 18.3 cents a gallon starting Oct. 1, down from 20.4 cents a gallon in September. The decrease was announced in a notice Thursday by the Indiana Department of Revenue.
Officials calculated the new rate by using the statewide average pre-tax price for gasoline, which dropped to $2.6115 a gallon during the Aug. 16 to Sept. 15 tracking period. This is down by about 10.3% from $2.9121 a gallon during the previous period, according to state records.
Since May, the sales tax on gas has been above 20 cents a gallon. September marked the fifth consecutive month of it being above this price, though it did drop slightly from August, records show.
The sales tax rate is separate from Indiana’s 36 cents a gallon gasoline tax, which is not impacted by the rising price of fuel. The 36 cents a gallon tax last increased by 1 cent on July 1, per Indiana law.
Rising fuel prices also do not affect the federal gas tax of 18.4 cents a gallon. The federal tax has been unchanged since 1993, records show.
Hoosiers will pay 72.7 cents in taxes combined, including 54.3 cents in state taxes, for every gallon of gasoline they purchase in October. This is down by about 2.7% from 74.7 cents in July, records show.
Revenue from Indiana’s gasoline sales tax is earmarked for state and local road construction projects.
