State Sales Tax Rates

State Sales Tax Rates Indiana State Sales Tax 2016

Indiana Sales Tax 2016
Indiana State Sales Tax for 2016 Maximum Municipal Sales Tax



What is the Indiana Sales Tax?

The Indiana state sales tax is 7.000%, with a maximum possible sales tax (including local and municipal sales taxes) of 7.00%.

Unlike some other states, Indiana does not allow local and municipal governments to impose their own sales taxes. The maximum sales tax that can be collected anywhere in Indiana is 7.000% of the qualifying purchase price.

Indiana recently raised the state sales tax from 6% to 7% in order to offset reduced property taxes statewide, and allows counties and cities to granularly set local sales taxes on the purchase of certain goods or services such as restaurants. Certain items are also exempt from sales tax statewide, such as water, icem groceries, and fruit juices in addition to most medecines. Most local sales tax revenue is used to expand local tourism and economic development projects.

What sales are exempt from the Indiana Sales Tax?

Many states set special sales tax rates for certain types of goods like groceries or clothes, and may completely exempt certain transactions from state and local sales taxes. Indiana, however, does not exempt any purchases from state or local sales taxes.

Indiana does not have special sales tax rates for certain types of purchase, a common practice in many states for goods such as food and clothing.While many other states also collect a special (and often higher) sales tax on prepared and restaraunt food, Indiana does not have a specific restaraunt sales tax.

Generally, the Indiana sales tax is collected only from the end consumer, or the end user of the product. Customers buying products in bulk, as a business-to-business transaction, or buying with the intent to resell do not have to pay the Indiana sales tax if they provide the seller with a Indiana Sales Tax Exemption Certificate at the time of purchase. Most states will accept the Uniform Sales and Use Tax Certificate for this purpose, which is available from the Multistate Tax Commission here.

Internet Sales Tax, or tax on purchases made over the internet, is currently a gray area in many states' tax codes. While most states can collect sales tax on internet purchases made within the state (the vendor and consumer are both located in Indiana), taxation of interstate internet transactions is much more complicated.

Currently New York, Rhode Island, North Carolina, Colorado, and Illinois have some form of online sales tax that also handles interstate transactions. For details on how Indiana handles taxation of online sales, read more about online sales taxes in the United States.


[1] Table of state sales taxes on Wikipedia

[2] Indiana Sales Tax Handbook 2016

[3] Table of state sales, use, and excise taxes by The Tax Foundation

[4] State level taxation resources on,,id=99021,00.html