Gas Sales Tax Set to Jump in May if Current Suspension is Not Extended

Indiana’s gasoline sales tax is expected to increase by about 6 cents per gallon on May 1, 2026, unless Gov. Mike Braun continues the current suspension. The state’s 7% sales tax on fuel is recalculated each month by the Indiana Department of Revenue using the statewide average retail price.

The agency reported that the rate, which was 17.2 cents per gallon when the suspension was announced on April 8, is set to climb to 23.3 cents for May if no action is taken.

Fuel taxes in Indiana are comprised of three parts: the federal gas tax of 18.4 cents per gallon; the state excise tax of 36 cents per gallon; and the 7% state sales tax. WFYI Indiana estimates suspending both state taxes would increase the savings on a 16-gallon fill-up from $2.75 to $8.51.