State Fiscal Policy

Maintaining a business friendly environment is anchored in fiscal discipline. Indiana has a balanced budget requirement in the State Constitution. The state has a balanced budget with rainy day fund surplus, a position maintained even in the most difficult of times such the crisis years of 2007, 2008, and 2009. The fiscal discipline of Indiana has resulted in Indiana being only one of nine states with a AAA bond rating from all three credit rating agencies. While maintaining this discipline, the state has simultaneously taken steps to improve the business environment over the last eight years.

These improvements have included the following:

—— Increased R&D Tax Credit

Provides a tax credit equal to 15% of a company's first $1 million of qualifying R&D expenditures, giving Indiana one of the highest R&D tax credit percentages in the country. (2005)

—— Major Moves

Indiana is the only state in the nation with a record-breaking funded $10 billion infrastructure improvement plan that includes the construction or renovation of more than 400 roads and bridges. (2006)

—— Single Sales Factor Corporate Tax

Companies in Indiana only pay state corporate taxes on the portion of a company's sales in Indiana. (2006)

—— Property Tax Relief

Cut property taxes by 1/3 and established a cap on property taxes that is anchored in the State Constitution. (2008)

—— Property Tax Exemption on IT Equipment

Allows municipalities the ability to permanently exempt personal property tax for enterprise information technology equipment. (2009)

—— Corporate Income Tax Rate Reduction

Decreases Indiana's corporate income tax rate from 8.5% to 6.5% over a four year period. (2011)

—— Raised Cap for VC Tax Credit

Increases the maximum amount of income tax credits available under the Venture Capital Investment Tax Credit from $500,000 to $1,000,000. (2005 and 2011)

—— Right-To-Work

On February 1, 2012, Indiana became the 23rd state in the nation to enact a right-to-work bill into law. (2012)

—— Tax relief

Lowered personal income tax rate by 5%, from 3.4% to 3.23% and repeals the state's inheritance tax. (2013)

Subscribe to our mailing list

* indicates required
Email Format