Why It Matters
Indiana motorists face a widening cost gap as diesel prices surge while gasoline buyers receive temporary tax relief.
What Happened
Governor Mike Braun excluded diesel purchases from the state’s recent gas tax suspensions, leaving commercial and personal diesel users without financial reprieve. The decision comes as diesel prices surpassed $6 a gallon for the first time in U.S. history, reaching an all-time high of $6.40 per gallon.
Braun stated that diesel was excluded because it is normally used by businesses rather than households. “Diesel is normally used by businesses. So, businesses versus households. That was the reason it wasn’t included,” Braun said.
The exclusion impacts a growing segment of Indiana’s vehicle fleet. There were 227,500 diesel vehicles registered in Indiana during 2025, representing about 4% of overall vehicles in the state. The percentage of diesel vehicles is growing while gasoline-powered vehicles are decreasing.
By the Numbers
$6.40 a gallon — All-time high diesel price
64 cents per gallon — Indiana’s diesel tax rate
37 cents a gallon — Indiana’s gas tax rate
$1.1 billion — Potential savings for motorists over eight months from tax suspensions
227,500 — Number of diesel vehicles registered in Indiana during 2025
4% — Percentage of overall vehicles that are diesel in Indiana
$1 — Increase in trash service fuel surcharge in the last year
30% — Percentage increase in trash service fuel surcharge
Zoom Out
Indiana has the fourth-highest diesel tax in the nation, according to the Tax Foundation. While gasoline was hovering around $4.44 per gallon nationally as of Thursday, diesel prices have risen 72% from a year ago, when they stood at $3.71.
The cost disparity affects both consumers and service providers. A reader with a pickup truck cited diesel prices at more than $5.60 a gallon. For a diesel-powered VW Jetta, topping off the tank costs $42, which does not even fill half the tank.
Businesses are passing fuel costs to customers. A trash service fuel surcharge increased by $1 in the last year, representing about a 30% hike. National gasoline prices have also risen 38% from a year ago, when they were $3.20 per gallon.
What’s Next
Braun indicated that further action on diesel taxes may be considered later. “Diesel’s a valid issue. It’d be something else that we could do. That’ll probably have to wait though until we see how long it sticks there,” Braun said.