Indiana – Auto Rental Excise Tax Updated

SALT Report 2273 – The Indiana Department of Revenue revised an information bulletin regarding the auto rental excise tax to reflect that Marion County’s supplemental auto rental excise tax will increase from 4% to 6%, effective March 1, 2013. Exemptions to the supplemental tax include:

  • Trucks that exceed a gross weight of 11,000 pounds,
  • The rental of a passenger motor vehicle or truck by a funeral director if the rental is part of the services provided by the director for a funeral, and
  • The temporary rental of a passenger vehicle or truck if the rental is made or reimbursed under a contract for mechanical breakdown insurance, automobile collision insurance, or provided while repair work is completed

However, vehicles that are rented by sales tax exempt entities will not be exempt from the auto rental excise tax, or the Marion County Supplemental Auto Rental Excise Tax. This applies to state or local governments, and nonprofit organizations.

The bulletin also reflects that the original supplemental auto rental excise tax that was imposed at 2% will expire on December 31, 2027. At that time, the remaining 4% of the 6% tax rate will expire on January 1, 2041.

For Further Information

Indiana Department of Revenue – Information Bulletin #47