Bringing Down the Cost of Living in Indiana

Everywhere I go, I hear the same concern from families: everything costs more. Groceries, electricity, healthcare, property taxes and the everyday expenses of raising a family have all increased. Government cannot control every price, but we can control how much government takes from your paycheck and whether our policies make the problem better or worse.

That is why keeping Indiana affordable has been one of my priorities at the Statehouse since my first session in 2021. I supported legislation cutting Indiana’s individual income tax rate from 3.15% in 2023 to 2.95% today, with another reduction to 2.9% coming in 2027. I also supported last year’s property tax reform package, which is projected to save Hoosier homeowners $1.3 billion over three years. It includes a new homestead credit of up to $300 and additional relief for seniors, veterans, farmers and small businesses.

We have worked on utility bills too. In 2022, I voted to eliminate Indiana’s utility receipts tax, requiring utilities to pass that savings directly to customers through lower rates. The repeal represented more than $220 million annually in tax relief. This year, I supported House Enrolled Act 1002, Indiana’s major utility-affordability legislation, which expands assistance for struggling families, provides more predictable billing and strengthens protections for residential customers.

And Indiana continues to exempt most grocery food from the state sales tax, meaning families do not pay Indiana’s 7% sales tax on staples like bread, meat, milk, fruits and vegetables.

But there is more work to do.

We need to keep driving down property taxes, demand affordable and reliable energy, confront Indiana’s high healthcare costs and look for responsible ways to reduce the everyday cost of raising a family.

My standard is simple: if government can responsibly leave another dollar in the pocket of a Hoosier family, we should look for a way to do it. Indiana should remain a place where families can afford to live, work, raise their children and retire.

I intend to keep fighting to make sure it does.

Rep. Chris Jeter (R-Fishers) represents Indiana House District 88, which includes portions of Hancock, Hamilton, Madison and Marion counties. He chairs the House Judiciary Committee and co-chairs the Bail and Release Review Commission.

The record behind this column

Four laws carry most of what is described above. Every date, vote count and public law number below comes from the Indiana General Assembly’s own records, and Rep. Jeter’s individual votes come from the recorded roll calls.

House Enrolled Act 1002 (2022): the utility receipts tax repeal, and the start of the income tax glide path

One bill did two of the things in this column. It repealed the utility receipts tax and the utility services use tax effective July 1, 2022, and it cut the individual income tax rate from 3.23% to the 3.15% that the column uses as its starting point. Utilities under the Indiana Utility Regulatory Commission were required to file a rate adjustment so the repeal reached customers rather than stopping at the utility, which is the mechanism behind “pass that savings directly to customers.”

House Enrolled Act 1001 (2023): the road to 2.9%

The state budget did the part that matters most for a household planning ahead. In the General Assembly’s own words, it “reduces the individual income tax rate to 2.9% by 2027 and eliminates all trigger provisions in current law.” Before that, further cuts were conditional on revenue targets being hit. Removing the triggers is what turned a maybe into a schedule. The rate is 2.95% in 2026 and falls to 2.9% on January 1, 2027.

Senate Enrolled Act 1 (2025): the property tax package

The new homestead credit is worth 10% of a homeowner’s property tax bill, capped at $300, starting with taxes payable in 2026, and homeowners 65 and older can qualify for up to $150 more. The law also phases in a larger supplemental homestead deduction, raises the business personal property exemption toward $2 million, limits levy growth, and requires a public property tax transparency portal.

On the savings figure, it is worth being precise about who is projecting what. The $1.3 billion over three years is the projection published by Senate Republican leadership. The Legislative Services Agency, the General Assembly’s nonpartisan fiscal office, estimated the bill would cut homestead property taxes by about $395 million in 2026. Those are not competing claims so much as different windows on the same law, and a reader is entitled to both.

House Enrolled Act 1002 (2026): utility affordability

The law reaches households already stretched thin. Electricity suppliers regulated by the Indiana Utility Regulatory Commission, other than municipally owned utilities, must apply a levelized billing plan to residential accounts of households eligible for and applying to the state’s home energy assistance program, beginning with the first billing cycle after June 30, 2026. Levelized billing is the “more predictable billing” in the column: it smooths the January spike and the August spike into something a family can budget against.

Common questions about Indiana’s cost of living

What is Indiana’s income tax rate in 2026?

2.95%, down from 3.0% in 2025 and 3.05% in 2024. It falls to 2.9% on January 1, 2027. The 2.9% target, and the removal of the revenue triggers that had made further cuts conditional, came from House Enrolled Act 1001 of 2023.

What did the 2025 property tax reform actually do?

Senate Enrolled Act 1 created a new annual homestead credit worth 10% of a homeowner’s bill, capped at $300, beginning with taxes payable in 2026, with up to $150 more for homeowners 65 and older. It also phases in a larger supplemental homestead deduction, raises the business personal property exemption, caps levy growth and requires a property tax transparency portal.

How much will the property tax law really save?

Senate Republican leadership projected about $1.3 billion in homeowner savings over three years. The nonpartisan Legislative Services Agency estimated roughly $395 million in reduced homestead property taxes in 2026. The first is a caucus projection across three years, the second a fiscal office estimate for a single year.

What was the utility receipts tax?

A tax imposed starting in 2006 on the retail consumption of utility services, including electricity, natural gas, water, steam, sewage and telephone service. House Enrolled Act 1002 of 2022 repealed it, and the utility services use tax with it, effective July 1, 2022. Utilities regulated by the Indiana Utility Regulatory Commission were required to file rate adjustments so customers saw the reduction.

Does Indiana tax groceries?

Indiana’s state sales tax is 7%, but food for human consumption sold for home consumption is generally exempt, so staples like bread, milk, meat, fruits and vegetables are not taxed. Prepared food, candy, soft drinks and dietary supplements are treated differently and remain taxable.

Who represents Indiana House District 88?

Rep. Chris Jeter, a Republican from Fishers. The district includes portions of Hancock, Hamilton, Madison and Marion counties. He chairs the House Judiciary Committee, co-chairs the Bail and Release Review Commission, and is a practicing attorney and Navy JAG veteran of the Iraq War.

Paid for by Jeter for Indiana.