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Gas tax, electric and hybrid fee increases coming soon

A Speeway gas station sits at the corner of an intersection. In the foreground, a white sedan drives past toward the traffic light out of frame. The Speedway sign lists Unleaded gas as $3.69 a gallon and Diesel at $4.23. To the immediate left of the large red sign displaying the prices sits an air pump. On the left third of the image is a sign displaying the price for E85 fuel at $3.14. Power lines criss cross the image, broken up by street lamps on the poles and stand alone lamps in the parking lot of the gas station, with a few large, green trees in the background.
Lauren Chapman
/
IPB News
Indiana is one of only about a dozen states that imposes a sales tax on gasoline. That rate is calculated each month, based on the statewide average gas price.

Indiana’s sales tax on gasoline will largely hold steady next month, increasing by just $0.001.

But there’s a bigger gas tax increase coming in July and, thanks to new legislation, several more Julys to come.

Indiana is one of only about a dozen states that imposes a sales tax on gasoline. That rate is calculated each month, based on the statewide average gas price. For June, it will be 20.4 cents per gallon.

That’s on top of the 33 cent-per-gallon state gas tax, which will go up a penny in July. Yearly increases in the gas tax were supposed to stop next year. But this session, lawmakers extended those penny-per-gallon hikes out until 2027.

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Also going up in July are special fees that hybrid and electric vehicle owners pay at the Bureau of Motor Vehicles. A 2017 law scheduled increases in those fees every five years, based on inflation. But now, thanks to HEA 1050, those fees will increase every year.

This year, fees on hybrid and electric vehicles are set to go up more than forty percent. Electric vehicle owners will pay $214 (up $64) and hybrid owners $72 (up $22).

Brandon is our Statehouse bureau chief. Contact him at bsmith@ipbs.org or follow him on Twitter at @brandonjsmith5.

Brandon Smith has covered the Statehouse for Indiana Public Broadcasting for more than a decade, spanning three governors and a dozen legislative sessions. He's also the host of Indiana Week in Review, a weekly political and policy discussion program seen and heard across the state. He previously worked at KBIA in Columbia, Missouri and WSPY in Plano, Illinois. His first job in radio was in another state capitol - Jefferson City, Missouri - as a reporter for three stations around the Show-Me State.