Governor extends suspension of Indiana’s gas taxes for another month

Gov. Mike Braun extended an emergency order Wednesday suspending Indiana’s gasoline taxes for another 30 days.

The suspension of the 62.5 cents per gallon of taxes that would otherwise be collected has contributed to Indiana having the nation’s lowest statewide average pump prices.

Braun’s decision, however, also is raising worries among local governments about the loss of vital funding for roadwork.

Braun said he would support the state diverting money from its cash reserves to substitute for the $100 million-plus monthly loss in road funding for state and local agencies.

“This is a gas savings (that) is kind of a lifeline through a tough period like this,” Braun said. “Whatever happens at the federal level, we need to get through that.”

The taxes covered by the order, which was set to expire Sunday without an extension, totaled roughly 59 cents per gallon of gasoline in May. Those suspended taxes would now be 62.5 cents per gallon due to a bump for June in the state use tax — effectively the state 7% sales tax collected on gasoline.

Braun first declared an energy emergency on April 8, temporarily lifting the state’s sales tax on gasoline to offset the rapidly escalating cost of fuel when Iran closed the Strait of Hormuz — a key transit hub for oil imports.

The governor extended the suspension for another 30 days through a second executive order May 6 — this time lifting the state’s 36-cents-per-gallon excise tax too.

Indiana’s average gasoline price Wednesday was $3.59 per gallon, the lowest statewide mark in the country and below the national average of $4.26, according to AAA’s tracking. The state average was $2.68 in late February before President Donald Trump launched the war with Iran that prompted a worldwide spike in oil prices.

Wednesday’s action extends the order through July 7.

Braun indicated the state’s energy emergency statute grants him the authority to extend both gas tax suspensions through early August, if needed, before legislative action is needed.

Deputy editor Tom Davies contributed to this story.