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Flat 2.95% for 2026, reduced from 3.00% effective Jan 1, 2026; scheduled to fall to 2.90% in 2027. Counties also levy local income taxes.
Indiana Taxes
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Indiana statewide rule
Indiana's state sales and use tax rate is 7%. Indiana has no general local sales taxes; some counties and municipalities add a 1% food-and-beverage (FAB) tax that applies only to prepared food and beverages.
§ in.gov
Get alerted when this changesLawLert pings you the moment Taxes law changes in Indiana. Free.Get the free appVerified Jul 7, 2026Reviewed
Every Taxes rule LawLert has for Indiana
Each rule below is the full statewide entry, with the official source it rests on and the date it was last checked.
Conditional
Indiana is NOT collecting its Gasoline Excise Tax or Gasoline Use Tax from August 7 through December 4, 2026. On November 4, 2026, Governor Mike Braun updated his energy emergency declaration and extended the suspension by executive order; it runs consecutively with the suspensions under his earlier orders (the gasoline use tax suspension began in April 2026). Because the taxes are suspended at the distributor level, the savings are meant to show up in the pump price. Normally, Indiana charges a per-gallon gasoline excise tax plus a Gasoline Use Tax that the Department of Revenue recalculates monthly at 7% of the statewide average retail price; those resume after December 4, 2026 unless the emergency is extended again. Separately, during the energy emergency (from September 30, 2026), farmers and timber harvesters — and only they — may use dyed diesel in any vehicle hauling farm and timber products on Indiana roads. State taxes only; the 18.4-cent federal gasoline tax still applies.
“In accordance with that executive order, the Indiana Department of Revenue won't collect Gas Use Tax or Gasoline Excise Tax from August 7 through December 4, 2026.”
Read on Nov 11, 2026 from in.gov.
Checked once · Nov 11, 2026
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No sales-tax holiday.
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Indiana's constitutional property-tax caps (circuit breaker credits) limit the bill to 1% of gross assessed value for homesteads, 2% for other residential and agricultural land, and 3% for nonresidential and personal property. Assessed value reflects market value-in-use; local levies set the rate. A homestead must receive the Homestead Standard Deduction to qualify for the 1% cap.
Permitted
Food and food ingredients ("grocery" food) sold unheated and without eating utensils are exempt from Indiana's 7% sales tax (Sales Tax Information Bulletin #29). Candy, soft drinks, dietary supplements, prepared food, alcoholic beverages, and tobacco remain taxable.
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