Indiana Gov. Mike Braun has extended a suspension of the state’s gasoline use tax, offering continued relief to drivers facing prices above $4 per gallon.
The Republican governor originally announced the 30-day suspension as gas prices surged following the U.S.-Israeli conflict with Iran, which disrupted global oil markets significantly.
Iran’s restriction of shipping through the Strait of Hormuz rattled energy markets worldwide, given that roughly 20 percent of the world’s oil is transported through that critical channel.
West Texas Intermediate crude oil, the North American benchmark, fell to less than $95 per barrel after President Trump announced a two-week pause in hostilities with Iran.
As of the initial announcement, Indiana gas prices stood at more than $4.13 per gallon, just under 3 cents below the national average, according to AAA.
That figure represented a jump of more than 67 cents compared to roughly a month earlier, and more than 90 cents higher than the same period a year ago.
Indiana’s gas tax includes both a standard excise tax and a gasoline use tax, with the latter set at approximately 7 percent of the statewide average retail price per gallon.
The gasoline use tax for the relevant month was calculated at just over 17 cents, based on the statewide average price from February 16 to March 15, which exceeded $2.45.
Braun’s order suspending the gas use tax does not affect the federal gas tax or the state excise tax, meaning drivers save approximately 17.2 cents per gallon under the measure.
Before the suspension, Hoosiers were paying around 72 cents in combined gas taxes, placing Indiana among the highest-taxed states for fuel in the entire nation.
The governor said at a press conference that he will “look at” whether to further extend the gas tax holiday at the end of the 30-day period but did not guarantee he would do so.
Braun also called on state Attorney General Todd Rokita to “enforce protections from price gouging” and urged retailers to pass the savings along to consumers directly.
“The state will be watching the pumps to make sure savings are delivered to Hoosiers when they go to fill up each week, or whenever they do,” Braun said.
The suspension is expected to save Indiana drivers approximately $50 million per month, according to figures Braun provided during the announcement.
Senate Tax and Fiscal Policy Chair Travis Holdman, R-Markle, led a group of Republican senators calling for the suspension, saying the price of gas was “adding too much pressure on Hoosiers and their wallets.”
Indiana House Minority Leader Phil GiaQuinta backed the move but argued that Braun should have acted to suspend the gas tax sooner than he did.
