Indiana Sales Tax Changed to 7 Percent – Effective April 1, 2008

With the passage of House Enrolled Act 1001, the Indiana sales tax rate increased to 7 percent effective April 1, 2008. This 1 percent increase is intended to help offset new limits on property taxes in Indiana.

Below is a detailed list of changes that HEA 1001 affects:

  • Sales tax rate – All transactions* occurring on or after April 1, 2008, are subject to a 7 percent sales tax rate. Utility companies, along with cable, satellite, television and radio service providers, are not required to collect the 7-percent rate until a customer bill is issued after April 30, 2008.
  • Multiplier on gasoline and special fuels – The sales tax gas multiplier is .0654 percent for gasoline and special-fuel retailers, effective for all transactions on or after April 1, 2008.
  • Sales tax collection allowance – Effective for reporting periods beginning after June 30, 2008, the sales tax collection allowances for retail merchants are as follows: 
    • 0.73 percent if the total sales tax collected was less than $60,000
    • 0.53 percent if the total sales tax collected was between $60,000 and $600,000
    • 0.26 percent if the total sales tax collected was more than $600,000

*Note: Property and services that are delivered after March 31, 2008, but paid for prior to April 1, 2008, are not subject to the 7 percent sales tax.

If you have any questions about the sales tax rate, please call us at (317) 233-4015, Monday through Friday, 8 a.m. to 4:30 p.m. You can also view the sales-tax information kit for more information.