Renewing your vehicle registration could be more expensive next year.
That’s because Indianapolis needs to raise more money in order to unlock $50 million annually from the state for road funding.
To do that, Democrats on the Indianapolis City-County Council are proposing an increase to the county excise tax to a flat $100. Right now, a typical car owner pays about $20.
The excise tax applies to vehicles such as cars and trucks that weigh less than 11,000 pounds.
Owners of large trucks, buses and other big vehicles pay a wheel tax. That tax would also increase to $240.
You can see how much you paid the last time you renewed your car’s registration from the Indiana Bureau of Motor Vehicles website. After logging in to your account, you can view your renewal history and download your most recent receipt.
The line labeled “County Vehicle Excise Tax” is the amount that would increase.
Councilors will introduce the proposal during their meeting June 1.
Mayor Joe Hogsett said he is opposed to the tax increases.
“Right now, families across our city are already stretched thin by rising costs at the gas pump, in utility bills, at the grocery store, and on everyday essentials,” Hogsett said in a statement, in part. Read the full statement here.
Council President Maggie Lewis, a Democrat, acknowledged that Indianapolis residents are already dealing with tough financial situations.
“I recognize the timing is not great for anyone,” Lewis said.
Hogsett can veto proposals from the council. The council can override a veto with a two-thirds vote.
If approved, the increase would begin Jan. 1, 2027.
Why this is happening now
Indianapolis officials have known for about a year that it could get $50 million in matching money from the state for local road projects. But Republican lawmakers tightened the rules during the 2026 legislative session.
Now, Indianapolis needs to raise more money each year to get the match: $50 million in 2027, $70 million in 2028, $80 million in 2029, $90 million in 2030 and $100 million beginning in 2031 and each year after.
If the city can’t show by the end of the year that it has the money, the match goes away, and it won’t come back.
“That’s a really important detail,” Democratic councilor Andy Nielsen said, “and that’s part of the urgency with which we are acting right now.”
State law also requires the money that the city raises to come from new revenue.
The council estimates that vehicle tax increases would bring in about $71 million in new revenue for 2027. Over five years, revenue would be around $355 million.
Combined with the state match and other transportation funding, the council expects about $856 million in new state and local infrastructure funding from 2027 through 2031.
What do you think?
You can give your feedback at three council committee meetings on June 9, 11 and 16.
The times and locations of those meetings are typically posted the week before on the council’s website.
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Mirror Indy reporter Tyler Fenwick covers housing and labor. Contact him at 317-766-1406 or tyler.fenwick@mirrorindy.org. Follow him on X @ty_fenwick and Bluesky @tyfenwick.bsky.social.
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