INDIANAPOLIS — The streak of falling gas prices continues, approaching 100 days. That decrease is also impacting Indiana’s gasoline use tax.
The Indiana Department of Revenue recently published the gasoline use tax calculation for October. The calculation shows the rate starting October 1 will be 22 cents per gallon, down from 24 cents in September.
The department calculates the gasoline use tax by taking the average retail price per gallon of gasoline in the prior month and multiplying it by the state retail tax of .07 cents. The state said the average retail cost was $3.1418.
The gasoline tax use tax has increased steadily since it reached its lowest point on record in June 2020. While the tax is dropping in October, it remains higher than almost any point before 2022.
In addition to the gasoline tax, people buying gasoline pay additional state and federal taxes. As of July, people pay 33 cents per gallon in gas excise tax, which goes towards infrastructure projects, and a federal tax of about 18 cents per gallon.
If the average retail cost of gasoline remains at $3.1418 in October, people would end up paying around $3.87 at the pump. As of September 19, AAA reports the average cost of gas in Indiana is about $3.668.
AAA reports the national average for a gallon of regular gas fell four cents in the past week, the smallest weekly decline in months. AAA says this may signal that the streak of daily falling average gas prices is nearly finished.
“All streaks have to end at some point, and the national average for a gallon of gas has fallen $1.34 since its peak in mid-June,” said Andrew Gross, AAA spokesperson. “But there are big factors tugging on global oil prices—war, COVID, economic recession, and hurricane season. All this uncertainty could push oil prices higher, likely resulting in slightly higher pump prices.”
Most of the country is now using less expensive winter blend gasoline, leading to modest pump price reductions.