Indiana governor proposes $225 tax refund payments – Chicago Tribune
INDIANAPOLIS — Indiana’s governor proposed a plan Thursday to tap into the state’s growing budget surplus and send $225 in payments to taxpayers to provide them with relief amid the worst inflation in 40 years.
Gov. Eric Holcomb said he would call for a special legislative session before the end of June so that lawmakers could take action on his proposal, which would provide the payments under Indiana’s automatic taxpayer refund law.
Hoosier taxpayers began receiving $125 payments last month under that law. If lawmakers approve his new plan, Holcomb said each eligible state resident would receive a combined total of about $350 in payments, with a married couple filing jointly receiving about $700.
“Hoosiers have real needs right now during this period of high inflation, from the gas pump to buying groceries, and everyone should benefit from the state’s success,” he said in a news release.
The proposed $225 refund payments would cost the state about $1 billion, according to the governor’s office.
Indiana tax collections have surged over the past year and could push the state’s cash reserves from last year’s record high of $3.9 billion to about $6 billion by the end of June.
Figures released Thursday by the State Budget Agency show that Indiana’s budget surplus grew by another $209.2 million in May and that revenues through the first 11 months of the fiscal year were $1.075 billion, or 6.1%, higher than forecast.
Republican House Speaker Todd Huston said Thursday that he supports Holcomb’s call for a special session “to put more money directly back into taxpayers’ pocket” and would work with the governor and his Senate colleagues to schedule one.
“By issuing another round of automatic taxpayer refunds, we can provide quick and substantial relief while maintaining the state’s prudent reserves and providing budget flexibility moving forward,” Huston said in a statement.
Republican Senate President Pro Tem Rodric Bray also signaled support for Holcomb’s proposed tax refund, noting the “unprecedented level of inflation our nation is experiencing.”
“Thanks to Indiana’s continued fiscal prudence, we can consider providing some relief to Hoosiers who are trying to adapt to today’s challenges by returning some of their hard-earned money back to them,” he said in a statement.
Earlier this month, Holcomb rejected calls for suspending state gas taxes to cut the 56 cents per gallon in state taxes on gasoline, saying instead that he was preparing a plan for “inflationary relief.” Holcomb said he agreed with Republican legislative leaders that suspending state gas taxes would be an inefficient way to get financial help to people across the state.
Democrats had called for Holcomb to issue an emergency order suspending the gas tax.
Senate Democratic leader Greg Taylor of Indianapolis said Thursday that providing a $225 payment “will help a lot of people trying to make ends meet right now.” But he said that amount isn’t enough and would only provide “temporary relief.”
“Hoosiers’ financial struggles are ongoing and relief needs to be ongoing as well,” Taylor said in a statement. “I do think we can go further, but I’m happy to see the Governor taking action to relieve Hoosiers during tough times.”