INDIANAPOLIS (Statehouse File) — As Hoosiers deal with the highest gasoline prices in several years, Indiana is adding another penny in taxes to every gallon starting July 1.
The 2017 law that added 10 cents in taxes to every gallon of gas purchased is the same one that allows the tax to continue to rise every year by as much as 1 cent per gallon.
Lawmakers passed House Enrolled Act 1002 to raise extra funds to repair the state’s crumbling roads and bridges. Last year on July 1, the gas tax rose from 18 to 28 cents per gallon. Now the new tax will be 29 cents.
But that increase is unlikely to have an impact on Hoosier pocketbooks, according to Greg Seiter, public affairs manager of the AAA Hoosier Motor Club.
“I don’t envision that as having an adverse effect on travelers simply because of what they are seeing right now at the pump is much more dramatic than that tax increase itself,” Seiter said.
The average price of a gallon of gas today is $2.88, he said, compared to a year-ago cost of $2.18.
The money generated by the tax increase is expected to create $1.2 billion in additional revenue by 2024 through new taxes and fees, with $350 million of the revenue going to fund local roads and $850 million funding state roads and bridges.
In addition to higher gas taxes, drivers are also paying an extra $15 to register their vehicles with the state. People driving hybrids are paying an additional $50 fee while those with all-electric vehicles pay $150.
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