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Indiana Announces Prepayment Rate for Sales Tax on Gas


In Indiana, certain refiners, terminal operators, and qualified distributers are required to collect prepayments of sales tax on gasoline. The prepayment rate for the following sixth-month periods must be published each June and December in the Indiana Register. Effective periods are January 1 through June 30, and July 1 through December 31.

The prepayment rate for sales tax on gasoline for the period January 1, 2013 through June 30, 2013 is eighteen and three-tenths ($0.183) per gallon. This figure was calculated pursuant to IC 6-2.5-7-1 and IC 6-2.5-7-14, using the August statewide average price per gallon of gasoline (retail), which was $3.259.

The prepayment rate is determined by:

"Step 1: Take the product of:

  1. The statewide average retail price per gallon of gasoline (excluding all taxes); multiplied by
  2. The state gross retail tax (7%); multiplied by
  3. Eighty percent (80%); and then
  4. Rounded to the nearest one-tenth of one cent ($0.001).

Step 2: Determine the lesser of the results in step one or

  1. The product of:  (i) The prepayment rate in effect on the day immediately preceding the day on which the prepayment rate is redetermined; multiplied by (ii) One hundred twenty-five percent (125%); and then
  2. Round the result to the nearest one-tenth of one cent ($0.001)."

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.