Tax Cuts for Hoosiers

Hoosiers work hard for their money, which is why Senate Republicans have supported 20 tax cuts in the past 10 years.

Cutting Income Taxes

Thanks to laws supported by Senate Republicans in 2022 and 2023, Indiana is in the middle of a staggered individual income-tax cut that will save Hoosiers almost $300 million in 2024 and $2 billion over the first five years. The rate is dropping each year until it bottoms out at 2.9% in 2027.

Other income-tax cuts include:

  • Exempting military income for members of the Armed Forces and National Guard from the income tax;
  • Phasing out income taxes on military retirement pensions and survivors benefits;
  • Doubling the income-tax exemption parents can claim for a new child; and
  • Cutting the corporate income-tax rate by approximately 42%.

Learn more about what Senate Republicans are doing to cut income taxes here.

Improving Property Tax Rates

Indiana also has the eighth-lowest median property taxes in the nation for homeowners and the No. 3 most taxpayer-friendly property-tax system in the country. Property-tax rates are set and collected by local government officials, not the state or General Assembly, but it is important for state lawmakers to ensure Indiana's tax system works fairly for all Hoosiers.

Although Indiana's property-tax system compares positively to other states, Senate Republicans know many Hoosiers are feeling the pain of rising property-tax bills. In recent years, Senate Republicans supported initiatives to provide property-tax relief for homeowners, small-business owners and veterans, including:

  • Establishing constitutional property-tax caps, which were approved by voters;
  • Expanding those who qualify for the disabled veterans property-tax deduction;
  • Doubling the business personal property-tax exemption from acquisition cost of $40,000 to $80,000; and
  • Expanding the assessed value and income thresholds as well as permanently indexing both thresholds each year for those over 65 to qualify for a property-tax deduction and circuit breaker credit.

In addition to these initiatives, Senate Republicans also supported legislation to make the property-tax appeals process more taxpayer friendly by stating that if a homeowner files an appeal for their home assessment, the assessed value of the property cannot go up as a result of the appeal. To learn more about the appeals process, click here.

Learn more details on our property-tax cuts here.

Returning Money to Taxpayers

In addition to supporting Hoosiers through steady tax cuts, Senate Republicans also supported returning money straight to taxpayers by way of the Automatic Taxpayer Refund (ATR), which was created by the General Assembly in 2011. The first ATR was delivered to Hoosiers in 2013, giving back $360 million to taxpayers. The second was delivered in 2021, returning $545 million, and a third ATR in 2022 returned $1 billion to taxpayers.

Continuing the Search for Improvements

Senate Republicans also supported the establishment of the State and Local Tax Review Task Force (SALTR) in 2023, which was created to take a comprehensive look at the state's tax system and see where improvements can be made for Hoosiers. The task force will continue through the end of 2024, after which recommendations will be made on how to further improve Indiana's tax system.

Learn more about the SALTR here.