Indiana’s gas tax holiday extends through Aug. 6

Just before the July 4th holiday, Gov. Mike Braun used his authority to extend the state’s gas tax suspensions for a fourth time. The tax breaks are now set to end on August 6. Most Indiana politicians agree that any further extension would need action from the General Assembly. While a special session to extend the gas sales and excise tax suspensions is still possible, lawmakers do not appear to be preparing for one at this time.

“The Speaker supports the Governor’s extension of the gas tax suspension,” said Molly Gillaspie, a spokeswoman for House Speaker Todd Huston, to the Indiana Capital Chronicle. “He is continuing to monitor to help ensure affordability for Hoosiers at the gas pump.”

The Build Indiana Council is monitoring the fact that the Indiana Department of Transportation and local governments will lose more than $530M in funding because of the suspensions. Gov. Braun has told the state to reimburse local governments for their estimated $175M in costs, but it is still unclear whether the governor’s office will cover the remaining $358M for INDOT.

While the suspensions have certainly created an interesting dynamic for road and bridge funding, the BIC team also feels they’ve elevated the discussion about why long-term strategies are needed to support Hoosier infrastructure. Conversations about overreliance on gas taxes are not new, especially as vehicles become more fuel-efficient, and we welcome dialogue on road funding as we enter the 2027 budget year.

Locally, the Indianapolis City-County Council took a significant step this week toward tapping into the additional $50M in road funding provided by the state. Council members passed a wheel tax increase to cover the local match. However, the vote was divided, 14-10, and it’s unclear if Mayor Joe Hogsett, who does not support the tax increase, will veto the measure.

The BIC team remains neutral in the mechanism Indianapolis chooses to raise funding for the match. But we feel encouraged that city leaders are working to unlock funding the General Assembly set aside for road improvements.