INDIANAPOLIS — The Indiana State Budget Committee heard testimony Thursday that the state's revenue is $3.3 billion above forecasts for the current budget cycle.
The state is projected to see reserves of $5.1 billion at the end of fiscal year 2022 and $4.1 billion in the next fiscal year.
“Today’s revenue forecast is great news and gives us a lot to consider in the months ahead. We’ve been very careful with how we’ve used fiscal resources to this point. And with constantly changing circumstances, we should evaluate all the information before adjusting or adding to our existing commitments,” said Gov. Eric Holcomb.
House Speaker Todd Huston (R-Fishers) echoed the governor's sentiment.
"Indiana's impressive fiscal outlook and the economic momentum behind it continue to outpace expectations. This momentum is fueled by so many hardworking Hoosiers and employers who proved their resiliency throughout the pandemic. Now, we find ourselves in a unique and enviable fiscal position that presents a wide range of unique opportunities. Looking ahead to this session, we're going to push hard for responsible and prudent tax cuts while maintaining our strong reserves, funding critical services and investing in our future," Huston said.
While Republicans point to fiscal responsibility leading to the surplus revenue, Democrats point to their American Rescue Plan.
“Thanks to the American Rescue Plan and strong economic growth in our state, Indiana will have additional tax revenue available over the next two years. This is an unprecedented situation and the legislature should respond accordingly by re-opening the budget to address the needs of all Hoosiers,” said Sen. Fady Qaddoura (D-Indianapolis).
Qaddoura and other Democrats want to see the excess revenue go toward things such as fully fund public schools and pre-k, public safety and increase dfunding for mental health services.
Indiana Gov. Eric Holcomb announced Wednesday approximately 4.3 million Hoosier taxpayers will receive a $125 refund after filing their 2021 taxes.
"We have an obligation to put this money back in the hands of taxpayers instead of leaving it in the hands of government," Holcomb said.
An estimated $545 million will go back into the pockets of Hoosiers after they file taxes. Holcomb is working with legislators to streamline the process and make another 910,000 taxpayers eligible for the credit. When that legislation passes, the Indiana Department of Revenue will start to process payments.
The DOR expects to to have all refunds for Indiana taxpayers completed by the April 18, 2022 filing deadline by May 1, 2022. The agency will provide further information about the extra money in 2022.
The $125 credit represents a 12-13% tax cut for most Hoosiers. The typical taxpayer liability is around $1,000.
How taxpayers will get their payments will be based on how their 2021 returns were filed. Taxpayers who apply for an extension will receive the payment after filing their return.