A BILL FOR AN ACT to amend the Indiana Code concerning taxation.
HB 1132 creates a new chapter in the Indiana Code authorizing Rush County to adopt a local food and beverage excise tax, beginning January 1, 2027. The county fiscal body could impose the tax only after holding at least one separate public hearing devoted solely to the proposed ordinance, and it would have to send a certified copy of any adopted ordinance to the Department of State Revenue. If adopted, the tax would apply to qualifying food and beverage transactions in Rush County that are already subject to state gross retail tax rules, with the tax collected and administered in the same manner as the state sales tax.
The bill sets the local tax rate in 0.25% increments and caps it at 1%. It defines covered transactions broadly to include food or beverage furnished, prepared, or served for consumption at a retail merchant’s location or on equipment provided by the merchant, including certain heated, combined, or utensil-provided items, while excluding transactions exempt from the state gross retail tax. Revenue would be remitted monthly to the county and deposited into a dedicated food and beverage tax receipts fund. The county may use the money only for tourism and economic development purposes, or to secure related bonds, leases, or other obligations.
HB 1132 would affect Indiana tax law by adding a county-specific local option tax authority for Rush County and by creating a new dedicated revenue stream and fund structure. It also includes a covenant protecting pledged revenues for outstanding obligations, limiting future repeal or amendment if doing so would impair debt repayment. The chapter and any tax imposed under it would terminate on July 1, 2047.
Because there are no committee transcripts or recorded votes provided, the overall sentiment cannot be measured from legislative debate or roll calls. Based on the bill text alone, the measure appears fiscally and economically oriented, with its stated purpose tied to tourism and economic development rather than broad tax relief or general revenue. No specific opposition or support is documented in the provided materials.
HB 1132 would add IC 6-9-78.2 to the Indiana Code, authorizing Rush County to levy a local food and beverage tax of up to 1% on qualifying restaurant and similar transactions. It would create administrative procedures for adoption, collection, remittance, and fund management, and it would restrict use of the proceeds to tourism and economic development or related debt obligations. The bill also establishes a sunset date of July 1, 2047, after which both the tax authority and the chapter expire.
No committee discussion or vote history was provided, so there is no direct evidence of support or opposition from legislators, local officials, or the public. From the bill’s structure, the measure appears to be a targeted local economic development financing tool, which typically draws support from county officials and tourism interests, but the provided record does not show any expressed sentiment.
The main potential points of contention are the creation of a new local tax, the breadth of transactions covered, and the restriction that revenues be used only for tourism and economic development or related debt service. Businesses subject to the tax, especially restaurants and food service merchants, may be concerned about the added cost and administrative burden, while taxpayers may object to a new excise tax. Another possible issue is the debt-protection covenant, which limits future legislative changes if revenues are pledged to outstanding obligations.