Indiana lawmakers are going to have to try harder if they really believe excess state revenue should be returned to Hoosier taxpayers.
Data released Friday by the State Budget Agency show Indiana can cover the entire 2023 budget year cost of the highly touted tax cuts approved in March by the Republican-controlled General Assembly using just the state’s extra revenue from February and March.
Last month, Indiana took in $1.46 billion in revenue, including $732.8 million in sales tax receipts, and $537.2 million in individual income tax payments, data show.
That total was $167.9 million, or 13%, more than anticipated by the state revenue forecast revised in December, as well as $224 million, or 18.1%, greater than the monthly revenue estimate used by state lawmakers in April 2021 as they crafted the two-year, $37.4 billion state spending plan.
The March result follows a February that saw Indiana beat its revised monthly revenue expectations by $136.1 million, or 13.6%, giving Indiana $304 million in excess revenue in just the last two months.
The nonpartisan Legislative Services Agency estimates the new tax cuts will cost Indiana $300.1 million during the state budget year that begins July 1.
Applying the February and March excess to that expense still leaves Indiana with $1.2 billion in extra revenue for the current budget year before tallying the state’s April, May and June receipts that typically outpace most other months.
Indiana also is projected to end the current budget year June 30 with $5.1 billion in its budget reserve, or 28.9% of 2023 state spending, notwithstanding an extra deposit of $545.5 million in a teacher pension account and using another $545.5 million to provide Hoosiers an automatic taxpayer refund.
Hoosiers should begin receiving their $125 automatic taxpayer refund payments later this month, or in early May, after the General Assembly last month approved Senate Enrolled Act 1 making all adults eligible for the payment, instead of only Hoosiers who pay income tax.
The $125 payment isn’t connected to the new tax cuts. But for most Hoosiers it will be more money than they’ll get from the tax law House Speaker Todd Huston, R-Fishers, falsely claimed is “the largest tax cut in state history.”
The only tax savings Hoosiers will see this year is the elimination of the utility receipts tax beginning July 1. That’s a 1.46% charge paid by both businesses and consumers on a portion of their electricity, natural gas, water, steam, sewage and telephone bills.
The biggest savings generally will go to big businesses since they tend to be the biggest users of utility services. A Northwest Indiana resident paying $100 a month to NIPSCO for electricity and natural gas will see their bill drop by about $1.
A $50 monthly phone bill may only go down a few pennies because of how different communications services are bundled and taxed.
Hoosiers, in theory, will know how much less they’re paying if they read the fine print at the bottom of their bills, even if they barely notice the reduction amid surging commodity prices driving up their overall utility costs.
The General Assembly has mandated utility providers note on the two bills following repeal of the utility receipts tax — in August and September, just ahead of the Nov. 8 general election — exactly how much each customer has saved because House Enrolled Act 1002 was adopted by the Legislature.
The other tax cut in the measure is a reduction in the individual income tax rate to 3.15%, from 3.23%, beginning Jan. 1, 2023.
That change will shrink the total state income tax paid by a Hoosier worker earning $50,000 a year to $1,575, instead of $1,615, an annual savings of $40, or about $1.54 more money in each biweekly paycheck.
Altogether, the legislation potentially drops the state income tax rate to 2.9% over a seven-year period so long as Indiana meets certain revenue and pension funding targets.
If fully implemented, the annual income tax savings for a $50,000 a year worker would amount to $125 a year beginning in 2029.
GOP lawmakers last month rejected a Democratic plan to drop both tax cuts in favor of pausing the collection of Indiana’s 32 cents per gallon gasoline tax and the state’s 7% sales tax on gasoline (approximately 22 cents per gallon) to immediately save Hoosiers money with fuel prices continuing to top $4 per gallon.
Meet the 2022 Northwest Indiana legislative delegation
State Sen. Frank Mrvan, D-Hammond
Updated
Jan 10, 2022
State Sen. Frank Mrvan, D-Hammond
1st Senate District
Represents: Hammond (south side), Munster, Highland, Griffith, Dyer, Schererville
Experience: State senator 1978-95, 1998-present; retired banker
Committees: Homeland Security and Transportation; Insurance and Financial Institutions; Local Government (ranking member); Veterans Affairs and the Military
State Sen. Lonnie Randolph, D-East Chicago
Updated
Mar 28, 2022
State Sen. Lonnie Randolph, D-East Chicago
2nd Senate District
Represents: Hammond, Whiting, East Chicago, Gary (west side), Griffith, Hobart, Merrillville
Experience: State senator since 2008, previously served 1994-98; attorney
Committees: Commerce and Technology; Insurance and Financial Institutions (ranking member); Judiciary (ranking member); Rules and Legislative Procedure; Tax and Fiscal Policy; Utilities (ranking member)
State Sen. Eddie Melton, D-Gary
Updated
Mar 28, 2022
State Sen. Eddie Melton, D-Gary
3rd Senate District
Represents: Gary, Lake Station, New Chicago, Hobart, Merrillville, Crown Point
Experience: State senator since 2016; community relations manager
Committees: Appropriations (ranking member); Education and Career Development; Health and Provider Services; Joint Rules; Rules and Legislative Procedure
State Sen. Rodney Pol Jr., D-Chesterton
Updated
Mar 28, 2022
State Sen. Rodney Pol Jr., D-Chesterton
4th Senate District
Represents: Ogden Dunes, Portage, Chesterton, South Haven, Burns Harbor, Beverly Shores, Michigan City, Westville
Experience: State senator since 2021; attorney
Committees: Corrections and Criminal Law (ranking member); Environmental Affairs; Local Government; Pensions and Labor; Public Policy
State Sen. Ed Charbonneau, R-Valparaiso
Updated
Mar 28, 2022
State Sen. Ed Charbonneau, R-Valparaiso
5th Senate District
Represents: Valparaiso, Hebron, Kouts, Jasper County
Experience: State senator since 2007; attorney
Committees: Appropriations; Ethics; Health and Provider Services (chairman); Rules and Legislative Procedure; Tax and Fiscal Policy
State Sen. Rick Niemeyer, R-Lowell
Updated
Mar 28, 2022
State Sen. Rick Niemeyer, R-Lowell
6th Senate District
Represents: St. John, Cedar Lake, Crown Point, Winfield, Lowell, Newton County
Experience: State senator since 2014, state representative 2012-14; small business owner
Committees: Environmental Affairs; Local Government; Tax and Fiscal Policy
State Sen. Mike Bohacek, R-Michiana Shores
Updated
Mar 28, 2022
State Sen. Mike Bohacek, R-Michiana Shores
8th Senate District
Represents: LaPorte County
Experience: State senator since 2016; consultant
Committees: Corrections and Criminal Law; Insurance and Financial Institutions; Judiciary; Local Government
State Rep. Carolyn Jackson, D-Hammond
Updated
Mar 28, 2022
State Rep. Carolyn Jackson, D-Hammond
1st House District
Represents: Hammond, Whiting
Experience: State representative since 2018; retired Cook County, Ill., probation officer
Committees: Environmental Affairs; Family, Children and Human Affairs; Natural Resources
State Rep. Earl Harris Jr., D-East Chicago
Updated
Mar 28, 2022
State Rep. Earl Harris Jr., D-East Chicago
2nd House District
Represents: East Chicago, Gary (west side)
Experience: State representative since 2016; small business owner
Committees: Government and Regulatory Reform; Roads and Transportation; Ways and Means
State Rep. Ragen Hatcher, D-Gary
Updated
Mar 28, 2022
State Rep. Ragen Hatcher, D-Gary
3rd House District
Represents: Gary (downtown and east side), Lake Station, New Chicago, Hobart
Experience: State representative since 2018; attorney
Committees: Commerce, Small Business and Economic Development; Courts and Criminal Code (ranking member); Government and Regulatory Reform
State Rep. Ed Soliday, R-Valparaiso
Updated
Mar 28, 2022
State Rep. Ed Soliday, R-Valparaiso
4th House District
Represents: Valparaiso
Experience: State representative since 2006; aviation safety consultant
Committees: Elections and Apportionment; Roads and Transportation; Utilities, Energy and Telecommunications (chairman)
State Rep. Pat Boy, D-Michigan City
Updated
Mar 28, 2022
State Rep. Pat Boy, D-Michigan City
9th House District
Represents: Michigan City, Chesterton, Beverly Shores, Long Beach, Westville
Experience: State representative since 2018; retired small business owner
Committees: Environmental Affairs; Natural Resources (ranking member)
State Rep. Chuck Moseley, D-Portage
Updated
Mar 28, 2022
State Rep. Chuck Moseley, D-Portage
10th House District
Represents: Portage, Chesterton, Ogden Dunes, Burns Harbor, South Haven
Experience: State representative since 2008; financial solutions associate
Committees: Employment, Labor and Pensions; Roads and Transportation (ranking member); Veterans Affairs and Public Safety
State Rep. Mike Aylesworth, R-Hebron
Updated
Mar 28, 2022
State Rep. Mike Aylesworth, R-Hebron
11th House District
Represents: St. John, Cedar Lake, Lowell, Schneider, Hebron, Kouts
Experience: State representative since 2014; farmer, former state environmental regulator
Committees: Agriculture and Rural Development (vice chairman); Courts and Criminal Code; Environmental Affairs
State Rep. Mike Andrade, D-Munster
Updated
Mar 28, 2022
State Rep. Mike Andrade, D-Munster
12th House District
Represents: Munster, Hammond (south side), Highland, Griffith
Experience: State representative since 2020; small businessman
Committees: Commerce, Small Business and Economic Development; Employment, Labor and Pensions; Veterans Affairs and Public Safety
State Rep. Vernon Smith, D-Gary
Updated
Mar 28, 2022
State Rep. Vernon Smith, D-Gary
14th House District
Represents: Gary (south side), Merrillville
Experience: State representative since 1990; education professor at Indiana University Northwest
Committees: Education (ranking member); Judiciary; Local Government
State Rep. Hal Slager, R-Schererville
Updated
Mar 28, 2022
State Rep. Hal Slager, R-Schererville
15th House District
Represents: Dyer, Schererville, St. John, Griffith
Experience: State representative 2012-18, reelected 2020; small business owner
Committees: Environmental Affairs; Ways and Means
State Rep. Douglas Gutwein, R-Francesville
Updated
Mar 28, 2022
State Rep. Douglas Gutwein, R-Francesville
16th House District
Represents: Newton, Jasper counties
Experience: State representative since 2008; small business owner
Committees: Agriculture and Rural Development; Environmental Affairs (vice chairman); Veterans Affairs and Public Safety
State Rep. Julie Olthoff, R-Crown Point
Updated
Mar 28, 2022
State Rep. Julie Olthoff, R-Crown Point
19th House District
Represents: Crown Point, Merrillville, Winfield, Lakes of the Four Seasons, Hobart
Experience: State representative 2014-2018, reelected 2020; small business owner
Committees: Family, Children and Human Affairs; Public Health (vice chairwoman); Veterans Affairs and Public Safety
State Rep. Jim Pressel, R-Rolling Prairie
Updated
Mar 28, 2022
State Rep. Jim Pressel, R-Rolling Prairie
20th House District
Represents: LaPorte County
Experience: State representative since 2016; small business owner
Committees: Commerce, Small Business and Economic Development; Roads and Transportation (chairman)
State Sen. Michael Griffin, D-Highland
Updated
Mar 30, 2022
State Sen. Michael Griffin, D-Highland
1st Senate District
Represents: Hammond (south side), Munster, Highland, Griffith, Dyer, Schererville
Experience: Former Highland clerk-treasurer; university instructor
Committees: Insurance and Financial Institutions; Local Government