Gov.-elect Mike Braun may have to implement some of his planned state government cost-cutting measures quicker than expected if Indiana's monthly tax collections remain sluggish ahead of the Republican's Jan. 13 inauguration.
Data recently released by the State Budget Agency show Indiana took in $1.4 billion in General Fund revenue during October — a shortfall of $84 million, or 5.7%, compared to the state's revenue forecast.
Sales tax receipts, along with individual and corporate income taxes, which together make up the bulk of Indiana's monthly revenue, each came in less than projected in October.
More troubling, Indiana's General Fund revenue through one-third of its 2025 budget year now is $342.7 million, or 5.1%, below the resources Hoosier lawmakers anticipated when they crafted the state's two-year spending plan.
Records show the $6.4 billion in total revenue between July and October also was $204.5 million, or 3.1%, less than Indiana's General Fund receipts during the same four-month period last year.
While some of that reduction is attributable to Indiana cutting its personal income tax rate to 3.05% from 3.15%, it also suggests Hoosiers aren't earning or spending as much as they did last last year.
But the State Budget Agency isn't panicking. It said tax payment timing, tax rate changes, federal policy decisions and a host of other factors can cause wide month-to-month fluctuations in state revenue results.
"These timing dynamics are expected to normalize over the coming months starting in December," the agency said. "Month-to-month changes are to be interpreted within the full fiscal year forecast. More than 60% of revenues are projected to come in between December and June."
An updated state revenue forecast for the rest of the current budget year, and looking ahead to 2026-27, is set to be presented Dec. 18 to the State Budget Committee.
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