Holcomb’s inflation relief plan: Send $225 to every taxpayer

INDIANAPOLIS (WISH) — Eligible Hoosiers would receive an additional taxpayer refund under a proposal Gov. Eric Holcomb released Thursday morning.

The governor’s plan would boost automatic taxpayer refund payouts by $225 per taxpayer. When combined with a previously-announced $125 refund, the governor’s office said eligible Hoosiers would receive about $350 in total. Married couples filing jointly would receive about $700.

The governor’s plan follows months of rising inflation coupled with record gas prices. According to AAA, a gallon of regular gas in Marion County cost $5.237 on Thursday morning, with the statewide average sitting at $5.238.

The plan would require legislative approval. Holcomb said he plans to call a special session to secure approval later in June. House Speaker Todd Huston and Senate President Pro Tem Rod Bray both released statements in support of doing so within minutes of the governor’s announcement. Huston said the refund would provide “quick and substantial” relief while maintaining the state’s budget reserves and providing budgetary flexibility.

The Indiana Democratic Party in a separate statement praised the move but called it “a bare-minimum band-aid” and said the state’s Republican leadership should have acted sooner. Rep. Greg Porter, D-Indianapolis, has led Democrats’ efforts to lobby for inflation and gas price relief since early March. He told News 8 he still would prefer a suspension of the gas tax since that would provide immediate relief but he was satisfied with the governor’s current proposal. He said he plans to vote for it and he doubts many Democrats will oppose it on principle.

“People are not just a principle. It’s not just a principle pain. It’s a real pain. And so I think we will embrace it, say we will do it, period, but we think there should be more,” he said.

How much relief the refund would provide is hard to gauge. Porter said he knows people with trucks and SUVs who now regularly spend $100 or more on a single fill-up. Prof. Kyle Anderson, an economist at the IU Kelley School of Business, said a one-time tax refund likely will only provide relief for a month or so. On a macroeconomic level, he said he doubted it would have much impact. However, Anderson said there are now indications inflation is slowing down. That, combined with wage growth, can help offset gas prices as well.

“Overall, right now the economy is pretty good. There’s a lot of jobs out there,” he said.

To see who qualifies for an Automatic Taxpayer Refund, click here.