Taxation in Indiana

[1] The base taxable amount is equal to the adjusted gross income determined on a payers federal tax return.[4] In 2014, the Indiana state legislature passed a law that cut the corporate income tax from 8.50% in 2014 to 6.25% in 2016, with further decreases to be phased in until the rate falls to 4.9% in 2022.[4] Indiana property taxes provide the greatest overall income to the state, with almost all of the proceeds going to fund local government.The proposed property tax rate are submitted to the Indiana Department of Local Government Finance in a report.[7] Property tax rates in Indiana are capped a maximum of 1% of value for residential, 2% of value for rental and farmland, and 3% of value for all other types (the actual rates may be higher, but the maximum paid after deductions is capped through a "circuit breaker" tax credit).The assessed taxes are collected by the Department of Local Government Finance and paid out to the accounts of the boards and counties.[11] The rate for an Indiana company is set by the state for their first four years based on the industry they do business in, after such you are evaluated on a host of criteria such as former employees on unemployment.A gaming tax is imposed on winnings in state casinos, horse tracks, and from the Hoosier Lottery that provided $647 million in revenues in 2008.A small bureaucracy was created to oversee the assessment and collection of the tax which was imposed at a fixed rate per acre.The tax provided very little income to the state, and most government activity was funded through public land sale for the first decade.During the subsequent legislative session, the General Assembly approved a 1% cap on property tax rates.The change drastically cut local government revenues and a 1 percentage point increase in the state sales tax was approved to offset the difference.