Compare state tax rates and rules — on income, ordinary purchases, gas, sin products, property, and more — across the U.S. Go to the Kiplinger Tax Map Indiana Add to State Compare List | View List View State Compare List (0) selected | Compare up to 5 The Bottom Line Mixed Tax Picture The Hoosier State dropped its flat income tax a smidge in 2017, from 3.3% to 3.23%, but many counties in Indiana also impose their own income taxes, with an average levy of 1.56%. The state's general sales tax is high, though municipalities don’t get to add to it. Sales Tax State levy of 7%. Income Tax Range The state has a flat rate of 3.23%.Counties also have the authority to impose an income tax, instead of levying property taxes. Currently, all 92 counties have enacted a local option income tax, with an average rate of 1.56%, per the Tax Foundation. Effective tax rate: 5.25% for single filers, 5.25% for joint filers. Motor Fuel Taxes Gasoline: $0.4662. Diesel: $0.5000. Property Taxes In Indiana, residents pay an average of $907 in taxes per $100,000 of assessed home value. Vehicle Taxes Sales tax is due on purchases. An annual excise tax is also levied, based on a car’s original MSRP and discounted for age. The amount due on a three-year old car that cost $20,000 would be $189. Sin Taxes Cigarettes: $1.00 per packSnuff: $0.40/ounce.Other tobacco products: 24% of wholesale priceBeer: $0.12 per gallonWine: $0.47 per gallonLiquor: $2.68 per gallon Taxes On Wireless Service 11.79% Inheritance and Estate Taxes None. About our methodology