By the numbers
Here's a summary of the fiscal year 2025 tax receipts collected and processed by DOR:
Sales & Use Tax
Rate: 7% statewide
Collections: $11,223,772,245
Individual Adjusted Gross Income Tax
Rate: 3.05% in 2024; 3% in 2025
Collections: $8,687,237,715
Local Option Income Taxes
Rate: Varies by county from 0.5% to 3%
Collections: $4,344,691,508
Motor Fuel/Motor Carrier Fees
Rate: Varies by fuel type
Collections: $2,054,149,903
Corporate Income Taxes
Rate: 4.9%
Collections: $893,760,059
Total Gaming Taxes
Rate: Varies by gaming type
Collections: $679,913,168
Other Taxes
Rate: Varies
Collections: $521,159,105
Cigarette/Alcohol Taxes
Rate: $1 per pack/varies by alcohol type
Collections: $385,024,900
Totals
Gross Collections: $30,636,257,349
Tax refunds: $(1,846,548,745)
Net Collections: $28,789,708,604
Hoosiers certainly love to talk about taxes, even if they sometimes don't like paying them.
Well, here's something to talk about.
The recently released Indiana Department of Revenue annual report details the state's eight top revenue categories and how much DOR collected from Hoosiers in each one during the 2025 budget year that ran from July 1, 2024, through June 30, 2025.
Sales taxes, as usual, topped the list. However, Hoosiers actually paid more in income taxes when revenue from the state income tax and county income taxes is added together.
Many Hoosiers will begin paying even more income tax in 2028 when a provision in Senate Enrolled Act 1 kicks in, allowing eligible municipalities to charge an income tax rate of up to 1.2% — on top of the state and county income taxes already being deducted from workers' paychecks.
The Republican-controlled General Assembly and Republican Gov. Mike Braun authorized localities to impose the new income tax to try to make up some of their lost revenue from the negligible property tax break for Indiana homeowners, and significant property tax cuts for Indiana businesses, set to take effect beginning next year.
Such tax stacking is not uncommon in Indiana. For example, the state charged motorists a gasoline tax of $0.35 per gallon during the 2025 budget year, as well as a 7% sales tax on all gasoline purchases, plus the $0.184 federal gasoline tax.
Hoosier lawmakers also agreed in April to boost Indiana's cigarette tax to $3 per pack from $1 starting July 1 to help pay Medicaid health care expenses.
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