Indiana moved on Wednesday to temporarily remove its state fuel usage tax in response to surging gasoline costs linked to the wider geopolitical tensions in the Middle East. Governor Mike Braun, a Republican, issued an emergency declaration that suspends the 7% usage tax on fuel for 30 days, with potential extension to be determined by "the circumstances in the Middle East."
The governor characterized the action as a "gas tax holiday" aimed at easing immediate financial pressure on residents. In announcing the measure, Braun said affordability was his top priority and indicated state authorities would actively monitor retail outlets to ensure that the reduction in tax is passed through to consumers.
"I am declaring a gas tax holiday to give Hoosiers relief from the pain at the pump from high gas prices. Affordability is my top priority," Braun said after issuing the emergency declaration.
Braun additionally directed the state’s attorney general to enforce existing protections against price gouging by fuel retailers. The governor said enforcement and "patrolling the pumps" would help verify that motorists receive the intended relief from the tax suspension.
The action makes Indiana the second U.S. state to enact a temporary suspension of a state-level gas tax amid the conflict. Georgia enacted a similar suspension last month as fuel prices rose in response to the fighting, which began February 28.
Officials noted there had been a two-week ceasefire brokered by Pakistan agreed on Tuesday between Iran and the U.S., but that fighting continued on Wednesday, and Braun said it would take time for consumers in Indiana to feel any easing resulting from the ceasefire.
Data cited in conjunction with the announcement highlighted the scale of recent price movement. The American Automobile Association reported the average price for gasoline in Indiana at $4.137, up from $3.466 one month earlier. A recent Reuters/Ipsos poll referenced by officials indicated 55% of respondents said their household finances had been affected at least "somewhat" by rising gas prices, and among those reporting an impact, 21% said it was "a great deal." Former President Donald Trump was quoted as calling the price increase a "short-term increase."
The 30-day suspension is tied explicitly to current developments in the Middle East and may be prolonged depending on how circumstances evolve. State leaders emphasized a dual focus on short-term consumer relief and oversight to prevent unfair retail pricing practices as the situation develops.
Summary of key facts
- Indiana suspended its 7% usage tax on fuel for 30 days under an emergency declaration.
- The suspension could be extended depending on events in the Middle East.
- State officials plan to monitor fuel retailers and asked the attorney general to enforce price-gouging protections.